Open interest was higher in hog futures yesterday on their lower performance.

Filed in Gold, Gold Bullion prices by on May 12, 2010 0 Comments

LEAN HOGS Good morning. Lean hog futures closed lower across the board on Tuesday although most contracts managed to finish the session well off their lows. Futures volume was good at 49,201 with open interest increasing by 2,683. The cash market yesterday was higher in the west and lower in the east as the two get re-aligned. The cash hog market for today is called steady with a mixed tone. The cutout continues to edge up, reluctantly. The value of the pork carcass matched the highs from last week and stands at a 20-month high. Pork is getting rather expensive, however. The cash talk for next week is firm to higher, but yesterday’s higher cash out west was likely for hogs for next week’s kill. It’s my opinion the market has topped and eventually the next major move in the hog futures will be downward. LIVE CATTLE Live cattle futures edged higher on Tuesday with a few of the deferred contracts posting a fresh contract high. The cash market was not actively traded with Kansas moving a few more cattle at $1.00, steady to up one cent from last week. Thus far widespread trade has not occurred in TX and NE. The beef continues to edge upward with end users likely booking inventory for use into the Fourth of July. We’re likely nearing the end of the solid summer demand and when this demand peaks, the wholesale beef should top out. It’s my opinion this could occur any day now. Beef packers are still short bought otherwise they would not have been shopping for inventory on a Monday. However, it also appears they’re reluctant to pay higher money for inventory, despite profitable margins. Thinking that a seasonal top is near, I’m actively executing hedge strategies for my producers. If you would like a free trial to my evening livestock wire which includes a grain market discussion give me a call or send me an email. dennis.smith@archerfinancials.com 877.377.7905

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Open interest was higher in hog futures yesterday on their lower performance.

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