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The market saw negative price action yesterday even with positive outside market influences and this may have helped spark a strong bounce overnight. The market ended lower on the session yesterday but well up from the mid-session lows. June hogs traded moderately higher early in the session to challenge last week’s highs finding support from other commodity markets and a sharp drop in the US dollar. However, a sell-off in cattle helped spark a long liquidation trend which drove the market below Tuesday’s lows. Futures were moderately lower on the session into the mid-day with an outside trading day. Cash hogs traded steady to $.50 lower on the day. Some weakness in pork values late Tuesday added to the negative tone. Traders had expected weaker packer demand for live inventory this week due to the smaller slaughter schedule. Cash is called steady to $1.00 higher today. Into next week, packers face a full schedule and a seasonal decline in supply for the next few months and packer profit margins have held positive this week. The estimated hog slaughter came in at 413,000 head yesterday. This brings the total for the week so far to 1.214 million head, down from 1.228 million last week at this time and down from 1.220 million a year ago. Lean Hog Index for the two days ending April 18th was 94.17. Pork cutout values, released after the close yesterday, came in at $96.34, up 3 cents from Tuesday and up from $96.31 the previous week. More and more restaurants and fast food outlets are adding bacon to menu items and this has provided a base of demand during the off-season. Prices this year are already pushing $1.50 as compared with $1.10 last year at this time and the market faces a declining supply ahead. Weekly average weights for Iowa/Minnesota for the week ending April 16th came in at 272.2 pounds, down from 273.1 the previous week, but still up from 269.3 pounds last year. The data suggests that producers are becoming more current with marketings.
TODAY’S GUIDANCE: Another sharp drop in the dollar and bullish tone for commodities should help support the market today and a turn up in cash prices into next week should add to the positive tone. June hog support comes in at 101.62 and 100.97 with 104.17 as next good resistance.
Hogs: Lower US Dollar and Turn Up In Cash to Support
by Terry Roggensack on April 21, 2011
Below is a sample of The Hightower Report’s Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
The market saw negative price action yesterday even with positive outside market influences and this may have helped spark a strong bounce overnight. The market ended lower on the session yesterday but well up from the mid-session lows. June hogs traded moderately higher early in the session to challenge last week’s highs finding support from other commodity markets and a sharp drop in the US dollar. However, a sell-off in cattle helped spark a long liquidation trend which drove the market below Tuesday’s lows. Futures were moderately lower on the session into the mid-day with an outside trading day. Cash hogs traded steady to $.50 lower on the day. Some weakness in pork values late Tuesday added to the negative tone. Traders had expected weaker packer demand for live inventory this week due to the smaller slaughter schedule. Cash is called steady to $1.00 higher today. Into next week, packers face a full schedule and a seasonal decline in supply for the next few months and packer profit margins have held positive this week. The estimated hog slaughter came in at 413,000 head yesterday. This brings the total for the week so far to 1.214 million head, down from 1.228 million last week at this time and down from 1.220 million a year ago. Lean Hog Index for the two days ending April 18th was 94.17. Pork cutout values, released after the close yesterday, came in at $96.34, up 3 cents from Tuesday and up from $96.31 the previous week. More and more restaurants and fast food outlets are adding bacon to menu items and this has provided a base of demand during the off-season. Prices this year are already pushing $1.50 as compared with $1.10 last year at this time and the market faces a declining supply ahead. Weekly average weights for Iowa/Minnesota for the week ending April 16th came in at 272.2 pounds, down from 273.1 the previous week, but still up from 269.3 pounds last year. The data suggests that producers are becoming more current with marketings.
TODAY’S GUIDANCE: Another sharp drop in the dollar and bullish tone for commodities should help support the market today and a turn up in cash prices into next week should add to the positive tone. June hog support comes in at 101.62 and 100.97 with 104.17 as next good resistance.
Tags: Hogs, Livestock
About Terry Roggensack