Recent surge in forward hog contract prices
by Cory Knutt, Swift Current Online (Canada)
Sep 21 2022
There's been a bit of a surge in forward hog contract prices.
That from Tyler Fulton, director of risk management with Hams Marketing Services.
"There's some opportunities that we haven't seen in a least a couple of weeks," he said. "That's coming partly from the weak Canadian dollar. Obviously, there's a fair amount of uncertainty and inflationary effects that is impacting our currency, but for right now, it's aiding in some support to Canadian prices. The bigger effect is coming from the hog futures side. I think we're up about close to four or five per cent on some of our winter forward contract prices, which for this time of year, and I'm saying this over the course of the last four or five days, that's a really positive development and one that we're seeing some activity on forward pricing from producers."
Fulton notes US cash prices are also supportive.
"I think most of that is coming from a firmer than normal carcass value. In particular, the belly prices have surged higher over the last week or so and that's contributed to some higher carcass values, and that trickles in to our Canadian hog pricing. That's a pretty positive thing for this time of year as well. But take it with a grain of salt because those belly prices are highly volatile. As quick as those values can jump, they can also fall apart. A lot more volatile and generally you can't rely on them quite as readily...