Lean hog futures rose the daily limit of three cents a pound Thursday amid a general shift by investors into riskier markets, although late profit-taking trimmed the gains slightly.
Many commodities were higher Thursday after the U.S. dollar plunged against an array of currencies, particularly the yen. This prompted renewed hopes for exports and helped support stock markets and commodities.
It was not just the yen that was important, however.
"The euro was at near-term highs, for instance, so exports to several markets had the potential to grow," said Sterling Smith, market analyst and broker for Country Hedging.
Further buying of lean hogs was evident during the day amid rumors that Japanese pork buying had not been interrupted by the disasters experienced by the country as many had expected earlier in the week. The renewed hopes for pork exports brought in bargain buying after a 6% price drop in just three days.
And after dropping prices in early week trading, many investors had evened their positions enough to be comfortable with their investments, leaving those who wanted to cover their short positions with no option but to take prices higher again, said Paul Nelson, director of risk management services for Blimling Management Services.
Cash hog markets also remained flat throughout the early week drop in futures prices, leaving the April futures contract lower than the cash price and undervalued when it closed on Tuesday and attractive to bargain hunters, Nelson said.
Additional buying came in as the April contract moved above the 10-day moving average.
The USDA's pork carcass composite price rose Thursday to $92.06 a hundred pounds, up 30 cents.