April hogs were able to close slightly higher for the session yesterday, after early pressure had pushed the market down towards a 4-session low. Ideas that hogs could quickly back-up in the country after a few days of digging out from the snow were seen as pressuring the market early. Strong pork values overnight are felt to be a supportive factor with the market early today, as they were able to post a new high for the move and could help to boost cash bids into next week. April has now taken a large premium to the cash market as near-term demand from South Korea has added to positive tone for the market. Many traders feel that demand should remain strong, especially if South Korea continues their series of purchases. Average weights are already considered to be at high levels, as producers have thought to have less incentive to keep their marketings current when futures hold a large premium to the cash market. The CME Lean Hog Index as of February 1 came in at 80.92, up 92 cents from the previous session and up from 77.15 the week before. This leaves April hogs at a 1,065 point premium to the cash market as compared with a normal premium near 500 points at this time of the year. The estimated hog slaughter came in at 398,000 head yesterday. This brings the total for the week so far to 1.420 million head, down from 1.687 million head last week at this time and down from 1.680 million head a year ago. Pork cutout values released after the close yesterday came in at $89.48, up 92 cents from Wednesday and up from $87.69 the previous week. This is the highest pork value since September 27th. Heavier than normal weights are widely seen as boosting production levels. While the actual slaughter numbers for the week ending January 22nd were down 0.43% from last year, actual US pork production for the same week came in at 451.9 million pounds, up from 444.6 million pounds the previous week and up 1.87% from year ago levels.
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