October hogs closed slightly higher on the session yesterday, as many traders are discussing the possibility of China buying US hogs into the fall when US production is normally on the rise. Rumors of China buying corn were thought to have supported a recovery in corn prices, and may have provided carryover support for the hog market as well. Packer profit margins are still in the black, which could hold cash prices steady over the near-term. Pork cutout values released after the close yesterday came in at $95.89, up 52 cents from Friday and up from $94.28 the previous week. This is the highest since August 31st. China pork prices are reportedly at record highs and up 5 weeks in a row, so there are ideas that China has an incentive to import US pork to slow inflation over the near-term as well as possibly importing corn to help the expansion process for the pork industry in China. A surge in the US Dollar combined with a selloff in the stock market, energy markets and grain markets helped to pressure hog futures early in the day. Cash hogs traded steady to $1.00 higher, which helped to support the market. The CME Lean Hog Index as of September 15th came in at 87.69, up 76 cents from the previous session and up from 87.08 the week before. The estimated hog slaughter came in at 425,000 head yesterday. This was unchanged from last week but up from 415,000 head one year ago at this time.
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