Fatter hogs lead to leaner futures prices

Hogs are getting fatter, reports Bloomberg - and that's pushing on the fundamentals of lean hogs futures. The average hog carcass weighed over 209 pounds last week, which is the heaviest they've been since 2002, reported the United States Department of Agriculture. Hogs are getting fatter, reports Bloomberg - and that's pushing on the fundamentals of lean hogs futures. The average hog carcass weighed over 209 pounds last week, which is the heaviest they've been since 2002, reported the United States Department of Agriculture. 

Higher quality feed is part of the reason the hogs have yielded so much meat, according to David Kruse, the president of CommStock Investments.Higher quality feed is part of the reason the hogs have yielded so much meat, according to David Kruse, the president of CommStock Investments.

Lean hog futures for December delivery fell 0.85 cents to 65.35 cents per pound on the Chicago Mercantile Exchange; earlier in the day, the price hit an intraday low of 65.15 cents per pound.Lean hog futures for December delivery fell 0.85 cents to 65.35 cents per pound on the Chicago Mercantile Exchange; earlier in the day, the price hit an intraday low of 65.15 cents per pound.

Feeder cattle futures also took a hit, dropping 0.125 cents to 110.675 cents per pound.Feeder cattle futures also took a hit, dropping 0.125 cents to 110.675 cents per pound.

Of course, the decreasing price of pork helps stimulate demand for bacon, sausages and other pork products. "There's been very good pork demand at these lower prices," Kruse told Bloomberg. "Both the consumer and retailer are getting a good deal."Of course, the decreasing price of pork helps stimulate demand for bacon, sausages and other pork products. "There's been very good pork demand at these lower prices," Kruse told Bloomberg. "Both the consumer and retailer are getting a good deal."

In the longer term, though, the prices might not last. Corn futures appear to be on the rise, and that cost will be passed on to farmers and ultimately to the broader market.In the longer term, though, the prices might not last. Corn futures appear to be on the rise, and that cost will be passed on to farmers and ultimately to the broader market.