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Pork Futures: Hog Complexes Settle Higher

by 5m Editor
9 May 2008, at 7:54am

CHICAGO - Pork bellies settled up sharply with July and August hitting limit up. Live cattle and feeder cattle posted considerable gains as well, reports FXStreet.

Chicago Mercantile Exchange lean hogs closed higher on general cash hog price strength, fund buying and the traders with long positions rolling out of June into July.

Lean hogs rose slightly at the open, prodded by warmed-over buying and Wednesday's sizable pork cutout price increase. Steady to $3 per hundredweight higher quotes for Missouri direct hog inspired speculative longs, sending shorts running for cover and catapulting the May contract to a new contract high.

Spot-June and nearby-July picked up more ground after both contracts broke free of psychological resistance barriers. The upsurge caught the attention of funds, triggering additional buy stops and emboldening June/July forward spreaders.

Meanwhile, deferred-month hogs responded favorably to spot-June and nearby-July's sharp rise and triple-digit gains in Chicago Board of Trade corn futures. April and 2009 June hogs posted fresh seasonal highs in the process.

Country hog buyers anticipate flat to firm cash hog bids for Friday, the eve of Saturday's estimated 40,000-head comparatively modest kill as packers try to get a grip on elusive profit margins.

Friday typically features position squaring before the weekend. And, after futures racked up impressive rallies recently, bullish traders Friday may be compelled to ring the register before the weekend.

June lean hogs closed 120 points higher at 76.47 cents a pound, and July closed 180 points higher at 77.10 cents.

May pork bellies closed 240 points higher at 78.70 cents. July ended 300 points higher at 79.77 cents.

View the FXSTREET story by clicking here.

5m Editor