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Meats

  #81 (permalink)
steptank
Columbus, Ohio
 
Posts: 8 since Jun 2021
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@Myrridin and everyone who posts on Meats, is it possible we are reaching the peak of the hog cycle? Barring another black swan in hogs like in 2014, approaching mid June/ early July hogs usually go straight down. I want to go short on the July/August hog future, what do you think?

Thank you for your time,
steptank

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  #82 (permalink)
 myrrdin 
Linz Austria
 
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steptank View Post
@Myrridin and everyone who posts on Meats, is it possible we are reaching the peak of the hog cycle? Barring another black swan in hogs like in 2014, approaching mid June/ early July hogs usually go straight down. I want to go short on the July/August hog future, what do you think?

Thank you for your time,
steptank

Yes, I agree. I am short the August contract with a stop on close above the recent high. I do not see a reason for a black swan.

My main position in the meats is still the LHG22-LHV21.

Best regards, Myrrdin

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  #83 (permalink)
steptank
Columbus, Ohio
 
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Entered short today at 108.15, thought it was going to pause again

/heq21 110.05 now

are hogs finding support here? or is this just some intraday activity?

Thanks,
steptank

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  #84 (permalink)
 myrrdin 
Linz Austria
 
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steptank;84 5586
Entered short today at 108.15, thought it was going to pause again

/heq21 110.05 now

are hogs finding support here? or is this just some intraday activity?

Thanks,
steptank

Hogs might still go lower, but the main profits for the shorts in the August contract should be in. I took profit on my (unfortunately) small position and stay with my long term position in the LHG22-LHV21.

Best regards, Myrrdin

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  #85 (permalink)
Hiraphor
London, UK
 
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myrrdin View Post
Hogs might still go lower, but the main profits for the shorts in the August contract should be in. I took profit on my (unfortunately) small position and stay with my long term position in the LHG22-LHV21.

Best regards, Myrrdin

Big ETF sell off, plus China seems a little oversupplied so that doesn't help exports. Have been macro moves across the board today. Not sure there's been a fundamental change, so much is macro driven.. still, good for all the short positions

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  #86 (permalink)
steptank
Columbus, Ohio
 
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Yeah this morning's micro rally made my tummy hurt pretty bad but I still came out in the green

I think the landscape for hogs right now is extremely bearish

The only supporting features I see are the decreased corn prices and the rate of inflation

Between China's hog supply/demand and US's economic condition, I think cattle longs win out over hogs in US.

Commodities as a whole were kind of reaching bubble levels with all the inflation concerns, which are still valid, but they did need a moment to cool off, I think that cool off is transpiring now.

Holding short,
steptank

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  #87 (permalink)
Hiraphor
London, UK
 
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steptank View Post
Yeah this morning's micro rally made my tummy hurt pretty bad but I still came out in the green

I think the landscape for hogs right now is extremely bearish

The only supporting features I see are the decreased corn prices and the rate of inflation

Between China's hog supply/demand and US's economic condition, I think cattle longs win out over hogs in US.

Commodities as a whole were kind of reaching bubble levels with all the inflation concerns, which are still valid, but they did need a moment to cool off, I think that cool off is transpiring now.

Holding short,
steptank

Perhaps, I'm not sure what hog supply looks like.. make sure you've looked at the supply picture properly before shorting such a prompt contract flat price!

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  #88 (permalink)
steptank
Columbus, Ohio
 
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Hiraphor View Post
Perhaps, I'm not sure what hog supply looks like.. make sure you've looked at the supply picture properly before shorting such a prompt contract flat price!

Right, tough to understand a lot of these ag commodities, not a lot of documentation that I can come across related to the price. For example, is an excess supply bearish for hogs due to oversupply or is it bullish because there is ample demand?

I saw China cancel its order of US hogs and reckon that is pretty bearish, I can at least establish that a commodity unwanted will not be priced well lol.

Also the correlation between hogs and corn/soybean seems pretty illusory as well.

I'd love some insight into these mechanisms behind hog prices, or reference material to read more

Thanks you guys!
steptank

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  #89 (permalink)
 myrrdin 
Linz Austria
 
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steptank View Post
Right, tough to understand a lot of these ag commodities, not a lot of documentation that I can come across related to the price. For example, is an excess supply bearish for hogs due to oversupply or is it bullish because there is ample demand?

I saw China cancel its order of US hogs and reckon that is pretty bearish, I can at least establish that a commodity unwanted will not be priced well lol.

Also the correlation between hogs and corn/soybean seems pretty illusory as well.

I'd love some insight into these mechanisms behind hog prices, or reference material to read more

Thanks you guys!
steptank

Kevin Bost publishes an interesting weekly newsletter explaining the mechanisms behind hog and cattle prices. It helped me a lot to understand what is going on in these markets.

Best regards, Myrrdin

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  #90 (permalink)
steptank
Columbus, Ohio
 
Posts: 8 since Jun 2021
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Out of my short, expect some support coming soon because the basis is getting wider. Daily hogs and pork was 4.47 higher yesterday but another limit down day?

Hopefully another opportunity will emerge to re-enter a short position in the near future.

The hog picture is still looks very bearish, but I was reading about the Iowa pasture conditions and it sounds like they are in terrible condition. Thereby increasing the price of beef and supplementary food (hay & corn). Perhaps this will increase demand for a cheaper meat like pork? And, will the increased corn prices lead to rancher's bringing their hogs to market sooner, leading to less supply?

A lot of variables to consider in ag,
steptank

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Last Updated on March 15, 2022


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