Lean hog futures were mixed to mostly lower Monday on the slowing momentum of near-term demand and supportive signs for the pork industry in 2012.
October hog contracts closed down 0.3 cent, or 0.3%, to 88.5 cents a pound. December hogs closed down 0.72 cent, or 0.9%, to 83 cents a pound. Futures for early next year rose.
The hog complex is bracing for cash prices to begin falling into October and November as producers expand production seasonally in coming months. As they do, supplies begin to outweigh demand from meat packers until fundamentals revert toward their mean in winter.
If current trends continue, the hog industry could get a boost of support next year from the combination of strong exports and smaller supplies of its rival beef. Rising prices of beef could help push consumers toward pork, analysts said, even as foreign buyers continue to order U.S. pork at historic rates.
Cash hog bids were reported from steady to as much as $1 per hundred pounds lower as pork processing plants have sufficient supplies through the middle of the week. Demand for late-week and weekend delivery may not be as strong as some dealers had hoped since three to four fewer plants plan to operate on Saturday.
Some livestock dealers and managers said cash prices could come under pressure throughout the week.
The latest Dow Jones Newswires pork packer margin index was plus $14.58 a head, compared with plus $12.14 the previous day.
The terminal markets traded mostly steady to up $1 a hundred pounds on a live basis.
The USDA's pork carcass composite value, a measure of wholesale prices, on Friday was up 33 cents at $97.84 a hundred pounds.