MEAT COMMENTS 09/02/2011 Friday, September 02, 2011 by Robert Short of PFGBest

Friday  9:35AM  9/2/11   Hog futures are lower early on the S&P market selloff starting at 2AM this morning.  At the same time Gold started higher as short term traders had been selling a 4 day 66% technical retracement only to get “blown” out.  Last year we closed 70 higher today as hog traders worried about a 4 day kill week might be price supportive to product.  This psychology fear and the fact we are holding a 38% contract retracement should put near term selling on hold.  There is also the very real possibility of a top in long April cattle futures against short October hog futures.  Should this spread unwinding start (floor talk that it will) additional short term upside pressure could be put on hog futures next week.  Not the time to be selling additional contracts.  Should stock indices fall away today they could take hog futures lower.

 We have had our late August cattle selloff on traders knowing Labor Day business was coming to an end.  The first two weeks of September is usually no-man’s land in cattle trading.  Futures can be push/pulled by outside markets.  Last half September will see psychology shift to better fall demand, but this year extensive feedlot populations may put a hold on this   No opinion at the moment, although we appear to have a small technical double bottom in the October contract.

There is a substantial risk of loss in trading futures and options. Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. PFGBEST, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

 

Recent articles from this author

• Livestock Market Comments(76) - Friday, February 10, 2012
• Livestock Market Comments(75) - Thursday, February 09, 2012
• Livestock Market Comments(74) - Wednesday, February 08, 2012
• Livestock Market Comments(73) - Tuesday, February 07, 2012
• Livestock Market Comments(72) - Monday, February 06, 2012

About the author

Bob Short brings extensive contacts within the meat industry and a large number of relationships with CME Group floor traders and trading desk personnel along with several decades of trading for his own account to bear for PFGBEST Research and customers around the world.

Bob’s experience includes a number of years’ experience with managed commodity futures accounts for customers of Shearson Lehman Brothers, and with the PFGBEST commitment to sustainable investing, he helps current investors and traders to capitalize on opportunities in managed products as they pertain to commodity allocations.

In a role with Bear Sterns in the 1990s, Bob facilitated that firm’s entry into livestock futures trading and hedging of beef and pork products, a capability that was greatly needed for their expansive business interests.

Before that, he participated in the market as a hedger and seller of pork and beef cuts as the president of SMC Holding Company, which at that time owned Bluebird Foods as well as controlling interests in food processing companies Agar Foods and Patrick Cuday.  His role included doing extensive private trades for these large U.S. food processors while also working with large-scale cattle feeders.

Earlier in his futures industry career, Bob was a broker with Heinhold Commodities, and right after college, he worked for Reliance Electric and Emerson Electric.

Bob holds a B.S. Degree from Purdue University.

Robert J. Short
Sr. Livestock Analyst
PFGBEST Research

Phone: 800.280-4566
Email: bshort@pfgbest.com

PFGBEST is among the largest non-clearing U.S. Futures Commission Merchants, with customers, affiliates and brokerage offices in more than 80 countries. The company is a leader in sustainable investing through diversified products including managed funds, futures, forex, options, full-service and discount brokerage, trader education, market research, and direct online futures trading through its BESTDirect™ platform, and numerous other platforms and applications.