For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be Tuesday, January 28, 2024, 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 opened lower and made the session low at 87.50. The early dip stopped shy of support at 87.10 and then turned higher and trading to the high by mid-morning at 90.475. The rally took price past resistance at 88.325 and 90.40 but couldn’t top the high from when the April contract took over as the lead contract on January 16th (90.50). Price consolidated the rest of the session and settled at 89.875. Cold Storage looked bullish as it showed stocks down from last year which could force the retail industry to get more aggressive in purchasing pork as slaughter numbers are expected to decline. Slaughter has started the week below last week and expectations are for slaughter numbers to decline, lowering production and with Easter coming later in the season, we could see the cutout work higher. The morning cutout was firm, giving hope to bullish traders that the retail industry is indeed getting aggressive and then the afternoon cutout closed strong just off the morning result providing hope that the run higher has started. This could help support the index and provide producers with higher prices if it continues to stay firm. The futures inability to take out the January 16th high and settle below resistance shows bulls have more work to do in my opinion. We’ll see!… A breakdown from settlement could see price test support at 88.325 and then 87.10. A rally past resistance at 90.40 could see price move towards resistance at 92.375.
The Pork Cutout Index increased and is 91.32 as of 01/24/2025.
The Lean Hog Index ticked lower and is at 81.92 as of 01/23/2025.
Estimated Slaughter for Monday is 483,000, which is above last week’s 422,000 and below last year’s 489,224.
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Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
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