U.S. hog futures were trading in mixed fashion early Tuesday with April up modestly on support from a flat-to-higher outlook for cash prices and expectations for pork exports to remain strong.
April, the front month futures contract for lean hogs futures at the Chicago Mercantile Exchange recently traded 0.55 cent higher, or 0.6%, at 88.95 cents a pound. April hit a 1 1/2-week high.
June hog futures, the most active contract, was last off 0.22 cent, or 0.2%, at $1.0075. It also hit a fresh 1 1/2-week high earlier in electronic trading at $1.0160.
Expectations for hog supplies to be generally stable with a year ago throughout the summer and for exports to set a new record high for the year provide a solid base of support for lean hog futures, analysts and brokers said.
The recent sharp rally from two-month to nine-week lows hit the middle of last week could result in a squaring off of the market, said Dennis Smith, analyst with Archer Financial Services. He said he was amazed at the sharp decline that occurred early last week following the earthquake and tsunami damage in Japan and equally amazed by how the market rebounded since then.
Gains in the front months were also capped by selloffs in other commodities such as live cattle and lower expectations for grain futures, analysts said.
In the cash markets, some pork processors Monday were looking for additional loads to arrive later in the week and that could occur again Tuesday, said livestock dealers and market managers. Predictions for cash prices ranged from flat to as much as $1 per hundred pounds higher on seasonal tightening of supplies and continued good demand.
Wholesale pork prices on Monday were up slightly, gaining $0.13 to $92.69, the highest since Aug. 30.
The terminal hog markets were called flat to higher with top prices expected from $56 to $58 on a live basis.