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Pork Futures: Lean Hogs Settle Higher

by 5m Editor
3 May 2008, at 4:37am

CHICAGO - Chicago Mercantile Exchange lean hogs closed higher Friday on short covering and forward spreading that fought against shifting by longs out of June into July and August.

Live and feeder cattle futures also ended higher while pork bellies finished mixed.

Despite bearish fundamentals, CME hogs rose at the start spurred by short covering and opinions that Thursday's board sell-off was over-exaggerated. Spot-June's oversold Relative Strength Index condition and lighter hog weights this week attracted spot-month buyers.

Also, USDA's announcement late Thursday that it would buy $50 million worth of pork for domestic programs was psychologically bullish for hog futures, said traders.

Meanwhile, speculators bought deferred lean hog contracts based on periodic Chicago Board of Trade corn spikes.

Nevertheless, front-month hogs slipped from morning highs on selling into up ticks and depressed midday direct cash hog quotes. Also, spot-June and nearby-July lost what had been initial technical support.

Source: FXstreet.com

5m Editor