For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, February 04, 2025, at 3:15 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
April Lean Hogs gap opened lower and made the session high at 89.575. It collapsed form here and almost went limit down. The market had a resurgence and approached the session high before crashing and going limit down for the session. It settled down limit at 86.35. The Hog market struggled with the tariffs the President put on Canada and Mexico. Mexico has been the darling of the US export market for pork, making up over 25% of our exports and a trade war would likely decimate our exports to Mexico. At least that is what the fear would be, leading to an overwhelming supply of pork in the US leading to a collapse in cash prices as we have nowhere to go with our pork except for home. So, traders ignored the continued strength in cash prices and a strong cutout. The future will be dark for the industry because of the tariffs. The tariffs from what I understand is because of the lack of commitment from the two countries to help prevent illegal aliens and drugs, especially Fentanyl from coming into the US from the porous borders. The idea is for our neighbors to tighten security and do their part to secure the border. They huffed and puffed and said we have a trade war brewing and will respond in kind with tariffs. The fear weakened traders’ spirits and the market crashed. The tariffs also seemed to weaken our neighbors’ spirits and they relented and said they will send troops to their borders to prevent illegal crossings. The President responded with delaying the tariffs until March. Is this enough to stabilize the market? We’ll see!… A breakdown from settlement could see price test support at 85.325. Support from the rising 21 and 50-DMA’s now at 85.375 and 85.175 is alongside and could provide strong support. If settlement holds, we could see price consolidate within the Monday trading range. Resistance is at 87.10 and then the rising 13-DMA now at 87.875 and the 8-DMA now at 89.40. The gap is from the Friday low at 89.775 and the Monday high.
The Pork Cutout Index increased and is 93.40 as of 02/03/2025.
The Lean Hog Index increased and is at 83.48 as of 01/30/2025.
Estimated Slaughter for Monday is 491,000, which is above last week’s 483,000 and last year’s 488,228.
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109