LEAN HOGS

Cash hog prices were down .50 yesterday with the cutout up .37, quoted at $77.17. Pork packer margins improved slightly and they remain highly profitable. Thus far, entering the spring season, there’s been no urgency on behalf of the packer to compete for hogs and raise cash bids. Slaughter is declining slightly and will continue to edge lower on a seasonal basis. However, the premium to cash structured futures market has topped, forming a seasonal peak. Despite continued Chinese export business, the lack of urgency in the cash and cutout is surprising and, frankly, a bit alarming. The Smithfield acquisition by a Chinese company several years ago appears to benefiting Smithfield but not the individual hog producer???? Hog futures have topped and we’ve been actively hedging portions of expected production for over a week.

I am long a few MMM's however will be trying to get out of them today if possible.
Dewey