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Pork Futures: Hogs Rise

by 5m Editor
20 December 2007, at 7:35am

CHICAGO - CME hogs firmed on short covering, spreads and speculative bargain hunting after futures dropped on profit taking after the opening bell.

Pork futures slowly floated upward despite Tuesday's pork cutout setback and lower cash hog prices Wednesday. Also, February and April's resilience was also forged around their respective 59.50-cent and 65.00-cent psychological support levels.

April also benefited from spreading out of February and June. And, several nearby-April participants heeded an agricultural firm's advice to buy April on Dec. 19.

Meanwhile, CBOT corn's advances lured a small band of speculative longs into the thinly-traded rear hog contracts.

Fundamental issues were overlooked Wednesday due to February's disconnect to current cash hog prices and the inconsistent state of wholesale pork demand.

Nevertheless, country hog buyers predict swine values to take another $0.50 to $1 per hundredweight hit Thursday as processors sort through plentiful supplies before the Christmas holiday.

Shorts may continue to claim profits to beat the holiday rush, but that means someone has to be on the buy-side of orders, a broker said. "You could very well have a repeat of what we saw today with initial selling at the start and buying on breaks," he said.

Several hog market participants who also trade cattle may be somewhat tentative heading into Friday's cattle-on-feed report.

Source: FXstreet.com

5m Editor