Hogs opened the week lower and selling accelerated as October slipped under last week’s low, and at the close, both October and December contracts were at the lowest levels since last December. The hog index was down $1.17 at $78.23, and the weekend slaughter data projects another $1.47 lower for Tuesday. Negotiated hog trade was $1.20 lower from Friday, while the pork cutout was off $.31 at $86.10. The belly market continues to implode and was down more than $6.
Scheduled loads were down slightly from a week ago, but still indicate that this week’s kill will likely top 2.3 million head. Our best guess is that the week’s actual kill will likely be closer to, or above last week as packers try to make up for next week’s holiday.
October and December hogs are very oversold, though the fundamental outlook for the hog market remains bearish on record supplies. Short covering rallies back to $60 or better offer the next opportunity for 4th quarter sales.
