Hogs were lower to start the week, with funds continuing to sell out their net long position in the hog market. Last week’s low held in April hogs while June traded at the lowest level since September. The lean hog index was down $.12 at $67.52, while the weekend slaughter data projects another $.47 lower for Tuesday.
Packers reported on Monday that they had just over 2 million head scheduled for delivery this week which was up slightly from a week ago. Based on Monday’s load count, we estimate this week’s kill at 2.43 million head versus 2.33 million a year ago. At the end of last week, the cumulative slaughter total was up 2.5% year over year.
Last week’s Commitment of Traders report showed that funds were still net long 15,000 contracts in the hog market, which was the smallest since April 2017. Major lows in the hog market over the last several years have been reached when managed money positions have fallen under 10,000 contracts.
The seasonal outlook is more favorable going forward, however, the cash market is still searching for that low.
