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April Lean Hogs opened decrease and continued right down to an early morning low that got here near closing the hole from the February 11th excessive at 93.025 to the February 12th low at 93.325 resulting in a rebound rally that took worth to the session excessive at 94.475. The rally stalled and broke right down to the session low at 92.875, closing the hole after which coming again a contact to settle at 93.10. The rally couldn’t overcome the February 12th excessive and the breakdown took worth again beneath the 93.50 help stage. This places strain on bullish merchants and has bears concentrating on the 92.375 help stage. The breakdown got here regardless of a robust exhibiting from the morning cutout as merchants should have thought we are going to see it fall again prefer it did the day earlier than, for my part. The cutout truly strengthened a bit within the afternoon report and the index ought to proceed greater. The money index was sturdy and is approaching the February contract which expires on Friday. The cutout and money market is powerful in comparison with final yr presently interval and will proceed to construct on its profitable run. Slaughter numbers have been coming in beneath final yr with weights in decline. It’s anticipated to proceed to fall wanting final yr and with a late Easter we might see pork demand proceed to develop as retailers proceed to arrange for the vacation. I imagine the USDA was off base with its hog provides on the final Hogs and Pigs report and we might proceed to see a lag in manufacturing that may hold costs at greater ranges than anticipated. This might hold futures transferring greater as we get into the March -June time-frame. We’ll see!… A breakdown from settlement might see worth check help at 92.375 and the rising 8-DMA is close by at 92.10. The 13-DMA, which can be rising is subsequent help at 91.325. If worth can overcome the important thing stage at 92.375 it might re-test the February 12th excessive. A rally previous right here might see worth check resistance at 95.30.
The Pork Cutout Index elevated and is 98.21 as of 02/12/2025.
The Lean Hog Index elevated and is at 87.08 as of 02/11/2025.
Estimated Slaughter for Thursday is 487,000, which is above final week’s 481,000 and final yr’s 489,039. The estimated whole for the week (to this point) is 1,959,000, which is above final week’s 1,945,000 and final yr’s 1,945,766.
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Ben DiCostanzo
Senior Market Strategist
Walsh Buying and selling, Inc.
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