Lean Hog Futures Rise While Slaughter Rates Decline

Lean hog futures ended the Friday session on a positive note, with contracts increasing by 57 cents to $1.22. However, the April contract overall declined by 50 cents throughout the week. The USDA reported the national average base hog negotiated price at $88.40 on Friday afternoon, marking a decrease of 99 cents from the previous day. Additionally, the CME Lean Hog Index fell 21 cents from the prior day to $89.20 as of March 19.

Commitments and Market Adjustments

Data from the CFTC’s weekly Commitment of Traders report indicated an increase of 1,138 contracts in the net long position for lean hog futures and options, bringing the total net long to 56,709 contracts as of March 18. This reflects ongoing investor confidence despite market fluctuations.

Pork Market Overview

The USDA reported a Friday morning FOB plant pork cutout price of $96.86 per cwt, which represented a $1 increase. However, the belly and picnic cuts were the only primals showing a decline. This week, USDA estimated the federally inspected hog slaughter at 2.428 million head. This figure is down by 81,000 from the previous week and 92,684 head compared to the same week last year, attributed to the midweek blizzard and subsequent transportation delays.

Hog Future Prices

Recent closing prices for hog futures were as follows:

• Apr 25 Hogs closed at $86.125, up $0.575.
• May 25 Hogs closed at $89.650, up $1.050.
• Jun 25 Hogs closed at $97.475, up $1.225.

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

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