U.S. lean hogs tumbled Monday with front-month April hitting a six-week low on rolling of positions and cautious views held by some traders about near-term demand.
April hog futures at the Chicago Mercantile Exchange slid 2.07 cents, or 2.3%, to close at 86.40 cents a pound. It was April's lowest close since Jan. 24. June fell 1.57 cents, or 1.6%, to 99.47 cents a pound, its lowest settlement price since Jan. 28.
Higher crude oil prices weighed on lean hogs from the outset as some traders held concerns about reduced consumer demand for pork with fuel costs moving up further, brokers said. Near midsession, key chart support levels were broken, which brought in more selling that sent prices to the day's lows.
Rolling of long positions out of April futures and into June and July attributed to the Standard & Poor's Goldman Sachs Commodity Index funds dragged down the front month, brokers said.
The rolling and other concerns offset optimism held by some traders for strong export sales to put a solid foundation under hog futures. "The losses were mostly of a technical nature and on rolling," said Tom Cawthorne, vice president and hog futures trader with R.J. O'Brien.
In the cash hog markets, prices were mostly flat as supplies and the current weekly slaughter schedules are considered to be generally well balanced, analysts and livestock dealers said. Prices at the terminal markets were unchanged.