A higher start to the day in the hog market was short lived, and April hogs were back below unchanged shortly after the open. Technical trading pressed losses through midday, and the market stayed down near the lows into the close. The hog index gained a penny to $73.84, and projected unchanged for Thursday.
While pork belly stocks at the end of December were known to be well above a year ago and also at multi year highs for December, the pork belly market continues to rally. The belly value on Wednesday was up $.74 at $149, and up more than $2 in just 5 weeks and also above the last high that was scored in early December. But compared to a year ago, the belly value is still $30-40, when 1st quarter highs were scored just over $180 through the month of December. But once again, it’s the belly value that is pulling the pork cutout value, and lean hog prices higher. However, slaughter margins remain weak, while the cash index looks to be forging a 1st quarter top.
Technically, hog futures have broken down this week, with next support for April near $71 and then $69.
