MURICO.com Forum

Hogs

What to Expect?
Fourth quarter pork exports are projected to increase by 30% compared to the fourth quarter of last year. Butcher numbers should be up 5% into the end of Nov and then they’ll drop off to just 102% beginning around the end of Nov. The cold storage was friendly in that total pork stocks, at 598.8 mm pounds, came in about 30 mm lower than expected. Ham stocks were 20 mm lower than expected at 201 mm lb. So total pork in the freezer is only up about 2% from this time last year. In other words, demand is doing a good job of keeping up with record large production.

The seasonal tendencies say to buy the summer hogs on Wed, Thurs and Friday. We used the sharply lower board today to unwind all hedges in the Dec options. At par with the index, I’ll take a chance on being unhedged. Consider this weakness a gift. Futures traders, evidently, are having a difficult time believing and comprehending the devastation that’s been done to the hog herds in Asia. The market is moving lower into the seasonal low timing….buy it.

Above is some of what I received from Dennis just now. I bought Dec hogs today and will buy more tomorrow if they are down!

Dewey