Positive Movement Despite Closing off Highs
Lean hog futures surged to a high of $1.25 during the day’s trading session, showcasing considerable strength. However, prices eventually settled mixed but mostly higher as the day drew to a close. Despite June recording a decline of 15c on Thursday, the week ended on a positive note with a net gain of $1.75 and a monthly increase of $1.25. The remarkable swing in June’s trading range from -$1.58 to +$3.27 during March demonstrates the volatility and resilience in the market.
Outlook from the NASS Report
The quarterly NASS report revealed that as of March 1, the hog inventory stood at 74.751 million head, marking a 0.6% uptick compared to the previous year. This figure slightly surpassed the trade’s expectations of a lower year-over-year hog herd. USDA’s data also disclosed that the breeding herd reached 6.02 million head. Moreover, the Dec-Feb pig crop showed a 1.9% increase from last year, totaling 33.15 million head, outperforming the trade’s average prediction of a 1.4% rise.
Strong Sales Highlighted in FAS Report
According to USDA’s Foreign Agricultural Service (FAS), pork sales for the week ending on March 21 hit 55.3k MT, representing a yearly high and the highest level since December 15, 2022. Noteworthy sales to Vietnam and Italy contributed significantly to this surge. Shipments for the same period reached 34.2k MT, bringing the yearly total to 390k MT, a robust 9.4% increase compared to the previous year’s pace.
Steady Performance in Pork Cutout Futures
Pork cutout futures market displayed light open interest but closed Thursday with a 12-cent gain, signaling a steady uptrend. The April contract concluded March with a net increase of $2.35. Additionally, USDA’s National Pork Carcass Cutout Value stood at $94.52 after a 46-cent rise in Thursday’s afternoon session. Meanwhile, USDA estimated the Federally Inspected (FI) hog slaughter at 1.946 million head for the week through Thursday, with slight variations from the previous week and the corresponding period last year.
Ending Note on Market Performance
As the market closed on the day, April 24 Hogs settled at $86.625, up $0.525, displaying a positive trajectory. Similarly, May 24 Hogs ended at $92.500, marking a modest gain of $0.100. The April 24 Pork Cutout also closed on a positive note at $95.625, up $0.125, highlighting the overall strength and resilience in the market.
Alan Brugler did not have any positions in the securities mentioned in this report. The information provided here is for informational purposes only. For further details, refer to the Barchart Disclosure Policy.
The opinions expressed in this article belong solely to the author and do not necessarily represent those of Nasdaq, Inc.
