Lean Hog Futures Surge as Market Conditions Shift

Market Trends Take a Turn – Lean hog futures experienced a notable increase to finish off the week, with contracts rising between 97 cents to $1.35, while December contracts closed up 17 cents. February contracts saw a smaller increase of just 47 cents this week. On Friday, the national average base hog negotiated price stood at $78.93, slipping 9 cents from the previous day. The CME Lean Hog Index reported at $83.92 on December 11, marking an increase of 31 cents from the day before.

Trader Positions Altered – Managed money reduced their positions, cutting back 2,748 contracts from their previous record net long position in lean hogs. As of December 10, the total long position is now at 130,759 contracts.

USDA Updates on Pork Prices – The USDA’s FOB plant pork cutout value rebounded on Friday afternoon, rising $2.30 to $94.61 per cwt. While the rib showed a slight decrease, the belly cut made significant gains, increasing by $8.99. The USDA also estimated the weekly federally inspected (FI) hog slaughter at 2.573 million head, which is down 29,000 head from the previous week and down 121,652 head compared to the same week last year.

Dec 24 Hogs closed at $83.725, up $0.175.

Feb 25 Hogs closed at $85.600, up $1.125.

Apr 25 Hogs closed at $89.750, up $1.300.

On the date of publication,
Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.