Ag Markets to Tighten Up


Shawn Hackett, President, Hackett Financial Advisors, Inc.

via MoneyShow - 11/22/2019


U.S. pork production is about to fall off a cliff in the first half of 2020, reports Shawn Hackett.


Given the Thanksgiving Holiday next week and delayed release of the Commodity Futures Trading Commission’s Commitments of Traders (COT) data until Monday Dec. 2, the next report on all Ag markets will be released over the weekend with the next one in the middle part of the first week of December.


As we highlighted previously with regards to unusually strong cash basis levels seen in many Ag markets from grains to coffee etc...we may be about to see the true fundamental tightness of many Ag markets call the bluff of the computer algorithms who may have taken things too far with extended periods of low prices…


... We are also becoming excited for the Lean Hog Market on the current collapse in prices. Smart money has not given us a buy signal since the beginning of the year but based upon current trends it also seems likely a buy signal will be triggered soon.


Pork prices in the United States are very high but we have too many hogs looking to be processed as animal weights surge. This temporary backing up of pigs that is depressing hog processors demand for hogs is about to end and end in a big way as we move into the first and second quarter of 2020 as supplies contract by 600 million pounds.


U.S. pork production is about to fall off a cliff in the first half of 2020. This should offer a period of high demand for hogs for processing as demand remains robust...