CME Hog Futures Sag in Late Week Trade: CME hog futures were lower on Friday, with October hogs slipping back below the 100-day moving average and marking the lowest weekly close in 4 weeks. June hogs were down a dime but again had support against its 100-day moving average.
The nearby CME hog crush spread has been gently rising over the last 2 months and is now more than $20 over the July low. This has lifted cash weaned pig prices, which have largely been above average all year. The USDA reported an average price of $36.67/head this week, up $3.75 for the week and $20 higher than a year ago. The average formula-based price of $42.80/head was $12.30 higher than a year ago.
The Commitment of Traders report showed that for the week ending Sep 10, funds sold 1,348 contracts against commercial buying of 2,759. The Tue-Tue price change was -$3.975.
Cash market weakness looks to persist into the end of the year, which will limit rallies. A seasonal high is forming and AgResource is bearish hogs, with a view that the cash market will at least test last year’s low at $65.
