Lean Hog Futures Surge Amid Trade Progress and Market Insights
Lean hog futures are experiencing a notable uptick on Friday, rising between 27 cents and $1.90 for nearby contracts. According to the USDA, the national average base hog negotiated price was reported at $94.33 on Monday morning, down $0.45. The CME Lean Hog Index also saw a decline, down 8 cents to $89.99 on May 8.
Trade Developments Impacting Market Outlook
A recent meeting between U.S. and Chinese trade representatives has yielded positive results, with an announcement indicating a 115% drop in tariffs for both nations for a period of 90 days. The U.S. reduced its tariff rate to 30% on Chinese goods, while China lowered its rate to 10%. Following some cancellations of pork orders, these developments should be viewed as encouraging.
Managed Money Positions and Slaughter Estimates
As of May 6, managed money increased its net long position in lean hog futures and options by 2,979 contracts, bringing the total to 70,622 contracts. On the same day, the FOB plant pork cutout value reported for Monday morning was down 49 cents on a carcass basis, standing at $97.34. The belly, butt, and loin cuts were the only primals reported lower.
Furthermore, the USDA estimated federally inspected hog slaughter for last week at 2.437 million head. This figure reflects a decrease of 49,000 head from the previous week but an increase of 56,877 head compared to the same week last year.
Market Prices for Lean Hogs
May 25 Hogs are currently priced at $90.650, up $0.275.
Jun 25 Hogs are at $98.175, up $0.600.
Jul 25 Hogs have risen to $102.325, up $1.900.
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 those of the author and do not necessarily reflect those of Nasdaq, Inc.
