The lack of a premium of April to the cash market could spark a significant bounce in the market if pork values turn up over the short-term. Exports are the key factor for the market this year. They represented 24.2% of the total production for the month of November, which the most recent month for which that data has been compiled. April hogs closed 55 higher on the session yesterday after choppy to lower trade early in the session helped push futures to their lowest level since January 31st. The market recovered from the early losses and traded slightly higher on the day, as a turn to more positive outside market forces helped spark some investor buying. With a seasonal tendency to push higher at this time of the year and a lack of much of a premium for April futures, the increased buying from fund traders helped to support. The upside bounce may have been limited by lower trade for the cash market and some weakness in pork values late Monday. Pork cutout values Monday were down 35 cents from Friday but up from the previous week. Pork cutout values, released after the close yesterday, came in at $85.18, up 43 cents from Monday and up from $85.17 the previous week. This pushed the market up to a one-week high. A rise in open interest to the highest level since early December was seen as a positive technical development. The CME Lean Hog Index as of February 3rd came in at 87.86, down 21 cents from the previous session but up from 87.71 the week before. The estimated hog slaughter came in at 421,000 head yesterday. This brings the total for the week so far to 840,000 head, up from 817,000 last week at this time and up from 828,000 a year ago.
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