April Lean Hogs went limit down and settled 56.525. The African swine fever continues to spread in Asia and Europe and hogs can’t rally. The U.S. has all the disease free pork (so far) and nobody seems to be buying. The Lean Hog index and the Pork cutout index continues to flounder as the slaughter rate remain high which is producing a tremendous amount of supply. Has the publicity surrounding the African swine fever dented foreign consumer demand for pork? Has continued strong demand in the U.S. for beef reduced demand for pork? Whatever the reasons, Hog futures were pummeled today with the first five trading moths all settling limit down. April Hogs settled below 57.025 the support level and a trendline 57.35. It took out the February 11th low at 57.875. Continued weakness could see price break down and test support at 55.475.Support then comes in at 53.80. A lack of selling pressure could see price consolidate within the Tuesday range.
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Friday, February 22nd at 2:30 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.
**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,
www.walshtrading.com
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.