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Pork Futures: Most Hogs Slip

by 5m Editor
25 September 2007, at 9:13am

CHICAGO - Lean hogs ended mostly weak on October/December forward spreads that lifted spot-October and pressured December. And, thinly-traded distant hog months landed in negative trading territory in part because of weaker CBOT corn contracts.

Pork futures waffled at the start as traders wrestled with bearish fundamental influences versus October and December's severely oversold chart conditions.

However, futures adopted a more bearish posture after market participants digested last Friday's pork cut out fall. Additional negative hog market ingredients included deteriorating calculated packer profit margins and USDA's monthly cold storage total pork and ham numbers on Friday.

What's more, steady to lower cash hog bids, particularly at direct hog markets, weighed on futures.

By the same token, traders who bought breaks were attracted to technically-oversold October and December contracts. And, both contracts's lightly bullish discounts to the exchange's hog index attracted down-side speculative shoppers.

Cash hog price weakness is expected to spillover into Tuesday which could keep spot-month hog buying at a minimum. Also, huge hog kills at higher weights tilt in favor of bearish traders.

Source: FXSTREET.com

5m Editor