Pig outlook: US Lean hog futures bulls fading this week, Prop 12, China's sow herd

 

by Jim Wyckoff, The Pig Site

7 January 2022

 

Expectations for large US slaughter levels are pressuring the lean hog futures market this week. Meatpackers typically ramp up operations after the year-end holidays.

 

Traders may suspect a supply backlog will undercut the market, or at least slow an anticipated price advance through early winter. Recent weakness in wholesale pork prices also weighed on the futures market. The rapid spread of the Omicron coronavirus variant holds potential to cause packing plant shutdowns to prevent disease spread among their workers. While the CME lean hog index looks to have put in an early seasonal low in late November, the rise from that level has been limited.

 

Latest US Department of Agriculture reports, and other news

 

JBS investigation urged by U.S., European lawmakers

 

US Senate Foreign Relations Committee Chairman Bob Menendez, U.K. House of Commons MP Ian Liddell-Grainger and European Parliament Committee on Agriculture and Rural Development Chair Norbert Lins called for a coordinated investigation into Brazilian-owned company JBS, its parent company J&F Investimentos and subsidiaries in Europe and the United States. “We also encourage our governments to scrutinize JBS’ antitrust and anticompetitive practices and assess whether the company’s abuses could permanently damage food supply chains,” the lawmakers said in a statement.

 

Biden to fight meatpackers on inflation

 

President Joe Biden promised to “fight for fairer prices” for farmers and consumers yesterday as he announced plans to combat the market power of the giant conglomerates that dominate meat and poultry processing. “Capitalism without competition isn’t capitalism, it’s exploitation,” Biden said. “That’s what we’re seeing in meat and poultry.” Biden joined USDA Secretary Tom Vilsack and Attorney General Merrick Garland to meet virtually with ranchers and farmers to hear complaints about consolidation in the industry, ratcheting up a campaign blaming anti-competitive practices in the industry for contributing to surging food inflation.

 

US wants tighter labelling standards for Product of USA meat products …

 

Biden, Vilsack meet with independent producers on concentration in US meat industry ...

 

California law on animal cruelty to impact US pork industry  ...

 

China’s sow herd up 4.7% from last year ...

 

The next week’s likely high-low price trading ranges:

 

February lean hog futures--$77.50 to $84.675, and with a sideways bias

 

March soybean meal futures--$395.00 to $425.00, and with a sideways-higher bias

 

March corn futures--$5.84 3/4 to $6.20, and a sideways-higher bias

 

Latest analytical daily charts lean hog, soybean meal and corn futures ...

 

more, including charts

https://www.thepigsite.com/articles/pig-outlook-us-lean-hog-futures-bulls-fading-this-week-prop-12-chinas-sow-herd