Lean hog futures settled lower on Monday after being higher early in the day. Hog futures started the day strong with traders generally bullish about cash market fundamentals. At midday, prices were mixed with nearby futures contract up, but deferreds slipping into the red. By settlement time, all contracts had turned lower. The February contract ended settled at $86.68, down $1.25. June was 63 cents lower at $100.90. The weakness in hog futures was surprising with almost all cash markets reporting higher bids on Monday. Cash prices are still below nearby futures, but the gap is closing. Cash prices are being supported by strong demand for hams for the holidays. Once that demand is filled, prices could turn lower.
Cotton prices managed to close higher once again on Monday, but off the day’s highs about midway in the daily trading range. The market posted a good short-covering rally late last week that punched through important overhead resistance on the charts and confirmed a genuine uptrend. Better manufacturing indicators in China are a supporting factor, as well as reports that Australian cotton producers have slashed their cotton acreage for harvest in 2013 by 30%, far more than originally expected. Cotton export sales have been strong recently and the growing evidence of a sustained downtrend in the U.S. dollar will only further enhance U.S. export competitiveness. At midsession, March cotton was right up against the long-term downtrend line on the chart, but could not punch through and then gave way to selling. March closed up just 7 points, at 73.90.