Lean Hog Perspective

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2009-04-22T19:27:00.000-05:00

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Hurley & Associates believes positions are unique to each person’s risk bearing ability; marketing strategy; and crop conditions, therefore we give no blanket recommendations. The risk of loss in trading commodities can be substantial, therefore, carefully consider whether such trading is suitable for you in light of your financial condition. NFA Rules require us to advise you that past performance is not indicative of future results, and there is no guarantee that your trading experience will be similar to the past performance.

Hog Comments - 04/21/09 Hogs are flat today as grains rally.

2009-04-21T18:44:00.000-05:00

CORN - May ‘09 Electronic
Open - $3.70, High - $3.79, Low - $3.68 1/2, Close - $3.74 Up $.04 1/2.
Thoughts - Long Term (6 months) - Bullish/Higher
Thursday I said: “My thoughts on corn getting stronger as the day progressed on Friday was obviously wrong and therefore I did not place my order to buy at $3.76 3/4 like I said I was going to. This is why I don't recommend doing as I write because I have the luxury of changing my mind before you read about it. If you have questions about something either email or call me! I had an order in today at $3.47 which is near down limit as a just in case order not expecting it to get there and it didn't. I also had an order during the last hour of trade to buy at $3.65 against my long $3.80 May '09 puts. This is an effort to manage the equity that I have in the $3.80 puts as well as give me a synthetic call option through Friday.

As I mentioned before I have a cycle taking us lower this week however there is one thing I want to pay attention to and that is the open we had for May '09 corn on Sunday night. We opened at $3.74 3/4 when the weekly low was $3.76, this is a POTENTIALLY friendly opening. We have also backed off $.47 from the high of April 2nd to today's low so I am not that bearish at these levels.”

May ‘09 corn: As mentioned I am not bearish at these levels give the decline we've had. Today was actually a pretty quiet day as it relates to volume so I'm not buying into this rally attempt. As of right now I am keeping my options open to purchase corn at a lower level with a preference of $3.67 1/2 if I can. I will be looking for this number tomorrow as I think the market has potential get near it tomorrow.

Bottom line: I am looking for the market to experience an early high and a late low tomorrow. I will continue to try and buy around $3.67 1/2.

May '09 Corn - Support/Resistance for 04-22-09
(R3) Resistance 3: $3.81 1/4
(R2) Resistance 2: $3.79
(R1) Resistance 1: $3.76 3/4
Today's close: $3.74
(S1) Support 1: $3.73 3/4
(S2) Support 2: $3.70 1/2
(S3) Support 3: $3.67 1/2 _________________________________________________________________________

MEAL - May ‘09 Electronic
Open - $319.20, High - $325.50, Low - $317.90, Close - $325.30 Up $6.10
Thoughts - Long Term (6 months) - Bullish/Higher
Thursday I said: "I continue to think the meal market has room for decline but tomorrow looks like an early low and late high type day. The May '09 meal contract is looking to confirm Friday's high of $333.90 as its high for the planting season. It wouldn't be surprising to see May '09 meal trade back near $305.80 which would be 50% of the most recent move. I will not chase the meal market at these levels but I still have a call spread in place to give me protection if the market moves higher on about 60% of my needs. I'm looking for a pull back toward $305.80 in the May '09 contract.”

May ‘09 meal: I said it yesterday and I will say it again today; I am not willing to chase the meal market at these levels. I have confidence in saying this because I have call spreads in place to allow me to be wrong directionally but still keep business under control. May '09 meal still needs to get back above $326.00 on a daily close before I think we can test our old high of $333.90 so that said, I will maintain my negative bias toward the meal market.

Bottom line: I’m looking for the market to have follow through to the upside early tonight/tomorrow and experience an early high and a late low.

May '09 Meal - Support/Resistance for 04-22-09
(R3) Resistance 3: $329.40
(R2) Resistance 2: $327.90
(R1) Resistance 1: $325.50
Today's close: $325.30
(S1) Support 1: $323.70
(S2) Support 2: $322.10
(S3) Support 3: $320.90
_________________________________________________________________________

HOGS - June ‘09 GLOBEX
Open - $72.40, High - $72.75, Low - $72.20, Close - $72.40 Up $.10
Thoughts - Long Term (6 months) - Friendly
Thursday I said: “After looking at today's June '09 contract close I see that today was the lowest close we've had since April 2nd, 2009. Looking at the cycle still showing lower into ultimately next week and the intra-day chart showing a small retracement of today's larger down move early in the day; I don't have a ton of good to say about the market. I am sure with producers in the fields doing work we could see the cash market stay firmer as we move forward but the charts don't show me anything to get excited about. I will continue to stay short with my call strategy in place to give me upside potential if I am wrong. Based on my cycle indicator I see weakness into May 4th."

June ‘09 hogs: June really didn't do much today as we traded within yesterday's range and failed to show anything of significance to change my mind on the market which is lower. I need to see the June '09 contract close above $72.75 for a couple days before I will say we could test $73.85 again. I am still of the opinion the market has more downside for the time being.

Bottom line: I’m looking for the market to be higher tonight/tomorrow and experience an early high and a late low and I'm staying hedged for now. If we close below $72.175 tomorrow and Thursday then I am looking for a test of $70.525.

June '09 Hogs - Support/Resistance for 04-22-09
(R3) Resistance 3: $73.75
(R2) Resistance 2: $73.00
(R1) Resistance 1: $72.75
Today's close: $72.40
(S1) Support 1: $72.20
(S2) Support 2: $71.675
(S3) Support 3: $71.22

NW_LS500
Des Moines, IA     Tue, Apr 21, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh 1/4" trim loins steady
to 1.00 lower; butts unevenly steady; sknd hams 20-23 lbs steady, 23-27 lbs
mostly 1.00-3.00 lower; sdls bellies 4.00 lower; lean trimmings not established.
Trading slow to moderate, with mostly light demand and mostly moderate to heavy
offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :             100.0
Loads TRIM/PROCESS PORK  :               2.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/21       102.0      59.91   73.12   70.56  38.85 106.46 45.90  72.78
Change :               -0.80   -2.11   -0.44   2.68   1.06  0.23  -4.42
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Apr 21, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.84 hgr   :  2.70 hgr   :  2.16 hgr   :   .45 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 49.00-64.00 : 49.00-64.00 : 49.00-64.00 : 49.25-60.54
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    60.90    :    62.17    :    61.92    :    58.38
--------------------------------------------------------------------------
Head Count      :   32,751    :   18,263    :   23,121    :    9,405
==========================================================================

Hurley & Associates believes positions are unique to each person’s risk bearing ability; marketing strategy; and crop conditions, therefore we give no blanket recommendations. The risk of loss in trading commodities can be substantial, therefore, carefully consider whether such trading is suitable for you in light of your financial condition. NFA Rules require us to advise you that past performance is not indicative of future results, and there is no guarantee that your trading experience will be similar to the past performance.

Hog Comments - 04/20/09 - Most Ag commodities take a break today.

2009-04-20T15:54:00.000-05:00

CORN - May ‘09 Electronic
Open - $3.74 3/4, High - $3.84, Low - $3.60 1/2, Close - $3.69 1/2 Down $.06 3/4.
Thoughts - Long Term (6 months) - Bullish/Higher
Thursday I said: “The May '09 corn contract is indeed looking for a bottom for the week but it doesn't seem to want to stop moving lower. I had an order in to buy May '09 corn at $3.76 3/4 to re-own what I exited at $4.03 but I didn't get my fill. I still have a bull call spread in place in case I am wrong. I think we will have an early low tomorrow and a late high because of the downward movement we've had this week and Friday profit taking and position squaring going into the weekend. I still have a cycle projection for corn to be soft (lower) into the week of next week.”

May ‘09 corn: My thoughts on corn getting stronger as the day progressed on Friday was obviously wrong and therefore I did not place my order to buy at $3.76 3/4 like I said I was going to. This is why I don't recommend doing as I write because I have the luxury of changing my mind before you read about it. If you have questions about something either email or call me! I had an order in today at $3.47 which is near down limit as a just in case order not expecting it to get there and it didn't. I also had an order during the last hour of trade to buy at $3.65 against my long $3.80 May '09 puts. This is an effort to manage the equity that I have in the $3.80 puts as well as give me a synthetic call option through Friday.

As I mentioned before I have a cycle taking us lower this week however there is one thing I want to pay attention to and that is the open we had for May '09 corn on Sunday night. We opened at $3.74 3/4 when the weekly low was $3.76, this is a POTENTIALLY friendly opening. We have also backed off $.47 from the high of April 2nd to today's low so I am not that bearish at these levels.

Bottom line: I am looking for the market to experience an early low and a late high because of my comments about high to low movement in the paragraph above. I will continue to try and buy around $3.65 or HIGHER if it looks like things may turn up.

May '09 Corn - Support/Resistance for 04-21-09
(R3) Resistance 3: $3.76 3/4
(R2) Resistance 2: $3.73 3/4
(R1) Resistance 1: $3.71 1/4
Today's close: $3.69 1/2
(S1) Support 1: $3.65 3/4
(S2) Support 2: $3.64 1/2
(S3) Support 3: $3.60 1/2 _________________________________________________________________________

MEAL - May ‘09 Electronic
Open - $326.00, High - $331.00, Low - $318.50, Close - $319.20 Down $7.40
Thoughts - Long Term (6 months) - Bullish/Higher
Thursday I said: "Reading my thoughts from yesterday proves the market has a mind of its own and will do what it pleases as it screamed through my resistance levels. The sell stops below $314.50 were never tripped today because the market never got that low. There is another potential sell signal setup tonight if the market opens above $329.40 and trades below this level it will trigger a sell on the candle stick charts. I am keeping my call spreads in place for now to maintain ownership if the market continues to move higher and will look to get more aggressive positions in place on a price decline.”

May ‘09 meal: I continue to think the meal market has room for decline but tomorrow looks like an early low and late high type day. The May '09 meal contract is looking to confirm Friday's high of $333.90 as its high for the planting season. It wouldn't be surprising to see May '09 meal trade back near $305.80 which would be 50% of the most recent move. I will not chase the meal market at these levels but I still have a call spread in place to give me protection if the market moves higher on about 60% of my needs. I'm looking for a pull back toward $305.80 in the May '09 contract.

Bottom line: I’m looking for the market to have follow through to the downside early tonight/tomorrow and experience an early low and a late high.

May '09 Meal - Support/Resistance for 04-21-09
(R3) Resistance 3: $328.00
(R2) Resistance 2: $326.20
(R1) Resistance 1: $322.30
Today's close: $319.20
(S1) Support 1: $318.50
(S2) Support 2: $315.90
(S3) Support 3: $312.40
_________________________________________________________________________

HOGS - June ‘09 GLOBEX
Open - $73.20, High - $73.20, Low - $71.675, Close - $72.40 Down $1.325
Thoughts - Long Term (6 months) - Friendly
Thursday I said: “The early high and late low happened again today and tomorrow is showing signs of similar activity. Today's trade action on the daily chart was nothing to brag about as we closed near where we opened. The cash market was lower at noon which gave an excuse for the futures to move lower the balance of the day. As stated in the above paragraph I am sticking to a cautious short-term outlook in the hogs as we move into the last half of April with the seasonal tendency to move lower in years where we closed above $70.00 on April 15th in the June contract."

June ‘09 hogs: After looking at today's June '09 contract close I see that today was the lowest close we've had since April 2nd, 2009. Looking at the cycle still showing lower into ultimately next week and the intra-day chart showing a small retracement of today's larger down move early in the day; I don't have a ton of good to say about the market. I am sure with producers in the fields doing work we could see the cash market stay firmer as we move forward but the charts don't show me anything to get excited about. I will continue to stay short with my call strategy in place to give me upside potential if I am wrong. Based on my cycle indicator I see weakness into May 4th.

Bottom line: I’m looking for the market to be lower tonight/tomorrow and experience an early low and a late high and I'm staying hedged for now. If we close below $72.175 tomorrow and Wednesday then I am looking for a test of $70.525.

June '09 Hogs - Support/Resistance for 04-21-09
(R3) Resistance 3: $73.20
(R2) Resistance 2: $72.95
(R1) Resistance 1: $72.725
Today's close: $72.30
(S1) Support 1: $71.95
(S2) Support 2: $71.675
(S3) Support 3: $72.00

NW_LS500
Des Moines, IA     Mon, Apr 20, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh bone-in loins mostly
weak; butts mostly 1.00 higher; processor cuts not tested; lean trimmings steady.
Trading slow to moderate, with light to moderate demand and mostly moderate
offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              85.5
Loads TRIM/PROCESS PORK  :               9.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/20        94.5      60.71   75.23   71.00  36.17 105.40 45.67  77.19
Change :               -0.17    2.91    0.96  -0.63  -0.42 -3.71    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Apr 20, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .70 hgr   :   .21 hgr   :   .57 hgr   :  1.28 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 48.25-62.16 : 49.50-62.16 : 49.50-62.16 : 48.25-62.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    59.00    :    59.38    :    59.77    :    57.93
--------------------------------------------------------------------------
Head Count      :   27,381    :    9,879    :   15,390    :   11,547
==========================================================================

Hog Comments - 04/16/09 - Meal takes center stage today.

2009-04-16T15:19:00.000-05:00

CORN - May ‘09 Electronic
Open - $3.85 1/4, High - $3.89 1/2, Low - $3.80 3/4, Close - $3.85 3/4 Up $.01 1/4.
Thoughts - Long Term (6 months) - Bullish/Higher
Yesterday I said: “Early resistance was a common theme in corn today the session high was indeed made early in the day. Today's trade in the May '09 contract was ugly to put it lightly and we closed below yesterday's low which isn't encouraging. As I've said recently I am looking for an opportunity to purchase May '09 corn around $3.76 1/2 if I can. $3.76 3/4 is our next downside target assuming we can break Monday's low of $3.83. I will gain ownership at $3.76 1/2 if possible against the $2.80 put options we own. I think this down turn in the market is a correction of what will be a longer-term higher move in the market based off of inflation fears. I am looking for the market to have follow through to the downside tomorrow and experience an early low and a late high”

May ‘09 corn: The May '09 corn contract is indeed looking for a bottom for the week but it doesn't seem to want to stop moving lower. I had an order in to buy May '09 corn at $3.76 3/4 to re-own what I exited at $4.03 but I didn't get my fill. I still have a bull call spread in place in case I am wrong. I think we will have an early low tomorrow and a late high because of the downward movement we've had this week and Friday profit taking and position squaring going into the weekend. I still have a cycle projection for corn to be soft (lower) into the week of next week.

Bottom line: I am looking for the market to experience an early low and a late high because of the aforementioned profit-taking going into the weekend. I will continue to try and buy around $3.76 3/4.

May '09 Corn - Support/Resistance for 04-17-09
(R3) Resistance 3: $3.94 3/4
(R2) Resistance 2: $3.89 3/4
(R1) Resistance 1: $3.87 3/4
Today's close: $3.85 3/4
(S1) Support 1: $3.85
(S2) Support 2: $3.80 3/4
(S3) Support 3: $3.76 3/4 _________________________________________________________________________

MEAL - May ‘09 Electronic
Open - $317.10, High - $329.40, Low - $316.80, Close - $329.40 Up $12.10
Thoughts - Long Term (6 months) - Bullish/Higher
Yesterday I said: "I’m looking for the market to have follow through to the downside tonight/tomorrow and experience an early low and a late high. I still feel the market is near a top and today could very well be this week's high. I will wait to re-enter an aggressive position in the market until we get back near $300.00 if we get there. Technically speaking there could be more sell stops below $314.50 tomorrow.”

May ‘09 meal: Reading my thoughts from yesterday proves the market has a mind of its own and will do what it pleases as it screamed through my resistance levels. The sell stops below $314.50 were never tripped today because the market never got that low. There is another potential sell signal setup tonight if the market opens above $329.40 and trades below this level it will trigger a sell on the candle stick charts. I am keeping my call spreads in place for now to maintain ownership if the market continues to move higher and will look to get more aggressive positions in place on a price decline.

Bottom line: I’m looking for the market to have follow through to the upside early tonight/tomorrow and experience an early high and a late low. I see a potential sell signal ONLY if we open at $329.50 or higher in tonight's trade. If the market opens slightly lower, then it is primed for a follow through move higher tomorrow. Stay objective in this market and don't chase it if you don't have coverage in place; if you need to protect meal use a call option for now and buy on a dip.

May '09 Meal - Support/Resistance for 04-17-09
(R3) Resistance 3: $348.70
(R2) Resistance 2: $340.10
(R1) Resistance 1: $332.80
Today's close: $329.40
(S1) Support 1: $324.00
(S2) Support 2: $321.10
(S3) Support 3: $318.60
_________________________________________________________________________
HOGS - June ‘09 GLOBEX
Open - $73.40, High - $74.10, Low - $73.175, Close - $73.275 Up $.225
Thoughts - Long Term (6 months) - Friendly
Yesterday I said: “I’m looking for the market to be higher tonight/tomorrow and experience an early high and a late low. I expect the June ‘09 hog contract to open higher tonight and follow through with early strength because of higher cash and cutout but falter as the day progresses. Seasonally we tend to move lower from today's close until the April 30th close and I will stick with the 80% odds of that seasonality along with the other signals that show up to support that type of move."

June ‘09 hogs: The early high and late low happened again today and tomorrow is showing signs of similar activity. Today's trade action on the daily chart was nothing to brag about as we closed near where we opened. The cash market was lower at noon which gave an excuse for the futures to move lower the balance of the day. As stated in the above paragraph I am sticking to a cautious short-term outlook in the hogs as we move into the last half of April with the seasonal tendency to move lower in years where we closed above $70.00 on April 15th in the June contract.

Bottom line: I’m looking for the market to be higher tonight/tomorrow and experience an early high and a late low. Once again the cutout was up by $.65 today and should provide some support for tomorrow's market; however, nothing is a "secret" anymore so I expect that some of today's positive cutout news has already been traded. I am sticking to my thoughts of early high and late low for tomorrows June '09 hog trade.

June '09 Hogs - Support/Resistance for 04-17-09
(R3) Resistance 3: $74.85
(R2) Resistance 2: $74.10
(R1) Resistance 1: $73.75
Today's close: $73.275
(S1) Support 1: $73.05
(S2) Support 2: $72.80
(S3) Support 3: $72.00

NW_LS500
Des Moines, IA     Thu, Apr 16, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh loins generally steady
to firm; butts mostly steady; sknd hams 23-27 lbs 3.00 lower, other weights not
tested; sdls bellies not tested; lean trimmings steady. Trading slow, with light
to moderate demand and mostly light offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             72.75
Loads TRIM/PROCESS PORK  :               6.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/16        78.8      61.91   77.65   69.43  35.79 107.54 48.73  76.71
Change :                0.65    2.02   -0.10   1.42   4.35 -0.80    unc
-----------------------------------------------------------------------

The Afternoon Price report was available at the time of this release so click here

for the report.

Hog Comments - 04-15-09 - Hogs inch... ahh, who am I kidding. IT'S TAX DAY!

2009-04-15T16:17:00.000-05:00

CORN - May ‘09 Electronic
Open - $3.94, High - $3.94 3/4, Low - $3.84, Close - $3.84 1/2 Down $.09 3/4.
Thoughts - Long Term (6 months) - Bullish/Higher

Yesterday I said: “ I am looking for the market to have follow through to the upside tomorrow and experience an early high and a late low. I look for support to be $3.93 1/4, $3.92 and $3.87 3/4. Resistance should show up at $3.95 1/4, $3.98 1/4 and $4.04. I expect the May ‘09 corn contract to open higher tonight and follow through with early strength and then meet resistance early.”

May ‘09 corn: Early resistance was a common theme in corn today the session high was indeed made early in the day. Today's trade in the May '09 contract was ugly to put it lightly and we closed below yesterday's low which isn't encouraging. As I've said recently I am looking for an opportunity to purchase May '09 corn around $3.76 1/2 if I can. $3.76 3/4 is our next downside target assuming we can break Monday's low of $3.83. I will gain ownership at $3.76 1/2 if possible against the $2.80 put options we own. I think this down turn in the market is a correction of what will be a longer-term higher move in the market based off of inflation fears.

Bottom line: I am looking for the market to have follow through to the downside tomorrow and experience an early low and a late high. I don't look for a test of R3 tomorrow but I think the market will be looking for this week's bottom tomorrow.

May '09 Corn - Support/Resistance for 04-16-09
(R3) Resistance 3: $3.92 3/4
(R2) Resistance 2: $3.91
(R1) Resistance 1: $3.88 1/4
Today's close: $3.84 1/2
(S1) Support 1: $3.83
(S2) Support 2: $3.79
(S3) Support 3: $3.76 3/4
_________________________________________________________________________

MEAL - May ‘09 Electronic
Open - $315.80, High - $321.80, Low - $314.50, Close - $317.30 Up $1.00
Thoughts - Long Term (6 months) - Bullish/Higher

Yesterday I said: “I’m looking for the market to have follow through to the upside tonight/tomorrow and experience an early high and a late low. I look for support to be $314.50, $313.50 and $312.10. Resistance should show up at $316.90, $319.00 and $325.20. I expect the May ‘09 meal contract to open higher tonight and follow through with early strength and then meet resistance early. **IF get above $319.00 either tonight/tomorrow or Thursday and move back below this level then I have a sell signal at $318.50 on the daily chart. If filled based on the sell signal then the protective buy stop order to manage risk would be $.50 above the current session high.** This is an observation only and it provides confidence in what the charts have already been saying at these levels, be careful if your long. As always please do what is right for your operation, take this information as insight not recommendation.”

May ‘09 meal: The early high and late low pattern worked on May '09 meal today but I think we may have some additional downside tomorrow. The signal that I talked about in the paragraph above was executed today and I did take the trade however I exited the straight futures portion of our position at $318.10 instead of the $318.50 stop like I said yesterday. I still have the call spreads in place to the upside in the event I am wrong because we still need protection. I will look for an opportunity to purchase these futures at a lower price if we can.

Bottom line: I’m looking for the market to have follow through to the downside tonight/tomorrow and experience an early low and a late high. I still feel the market is near a top and today could very well be this week's high. I will wait to re-enter an aggressive position in the market until we get back near $300.00 if we get there. Technically speaking there could be more sell stops below $314.50 tomorrow.

May '09 Meal - Support/Resistance for 04-16-09
(R3) Resistance 3: $321.80
(R2) Resistance 2: $319.30
(R1) Resistance 1: $318.60
Today's close: $317.30
(S1) Support 1: $315.50
(S2) Support 2: $313.10
(S3) Support 3: $310.90
_________________________________________________________________________

HOGS - June ‘09 GLOBEX
Open - $72.75, High - $73.475, Low - $72.00, Close - $73.05 Up $.45
Thoughts - Long Term (6 months) - Friendly

Yesterday I said: “I’m looking for the market to be higher tonight/tomorrow and experience an early high and a late low. I look for support to be $72.60, $71.95 and $71.05. Resistance should show up at $73.35, $73.55 and $74.25. I expect the June ‘09 hog contract to open higher tonight and follow through with early strength because of higher cash and cutout but falter as the day progresses. I am looking for a test of $70.52 within the next week if we close below $72.70 tomorrow in the June ‘09 contract."

June ‘09 hogs: I haven't altered my thoughts on the June '09 hog contract for now as I believe it has some room to move to the downside in the next week or so. Cash and cutout were both higher this afternoon so it should give the market a small boost tomorrow. Today we retraced around 62% of yesterday's move which is typical but the low of today also completed a 62% retracement back to our low of $70.52 from March 30th. The market is trending lower but I still need to see a close below $72.70 if we are going to test $70.52 and we didn't get it today.

Bottom line: I’m looking for the market to be higher tonight/tomorrow and experience an early high and a late low. I expect the June ‘09 hog contract to open higher tonight and follow through with early strength because of higher cash and cutout but falter as the day progresses. Seasonally we tend to move lower from today's close until the April 30th close and I will stick with the 80% odds of that seasonality along with the other signals that show up to support that type of move.

June '09 Hogs - Support/Resistance for 04-16-09
(R3) Resistance 3: $74.25
(R2) Resistance 2: $73.75
(R1) Resistance 1: $73.475
Today's close: $73.05
(S1) Support 1: $72.55
(S2) Support 2: $72.15
(S3) Support 3: $70.525

NW_LS500
Des Moines, IA     Wed, Apr 15, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh bone-in loins 2.00-6.00
higher; butts steady to 3.00 lower; sknd hams 20-27 lbs 2.00 higher; sdls
bellies not established; lean trimmings steady. Trading slow, with light to
moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              58.5
Loads TRIM/PROCESS PORK  :              15.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/15        73.5      61.26   75.63   69.53  34.38 103.19 49.53  76.71
Change :                0.60   -1.33    0.68  -5.46  -0.13  5.98   0.03
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Apr 15, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .83 hgr   :   .70 hgr   :   .79 hgr   :   .78 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.00-58.45 : 52.70-58.45 : 46.00-58.45 : 47.50-58.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    56.09    :    56.50    :    56.69    :    55.05
--------------------------------------------------------------------------
Head Count      :   23,141    :    9,987    :   14,840    :    8,101
==========================================================================

_________________________________________________________________________

Hog Comments - 04-14-09 - I knew pigs couldn't fly.

2009-04-14T16:50:00.000-05:00

CORN - May ‘09 Electronic
Open - $3.87, High - $3.99, Low - $3.85 1/4, Close - $3.94 1/4 Up $.06 3/4.
Thoughts - Long Term (6 months) - Bullish/Higher

Yesterday I said: "I am still bullish corn for reasons other than grain fundamentals, the U.S. Dollar Index was down 1.23 as I was writing this today and I am more concerned about the U.S. Dollar as a fundamental to corn than I am weather. Support for tomorrow’s market looks like $3.85 3/4, $3.83 and then down to $3.76 3/4. Resistance should be $3.89 1/2, $3.90 1/2 and then up to $3.94. I am expecting a sideways market tomorrow, there were signs of bottom picking today and would suggest buy stops above $3.90 1/2 for tomorrow but I am not convinced of it yet. I am still cautious in the short-term at this price level but I am willing to begin scaling in purchases around $3.76 1/2 which will replace my long call spreads I talked about before."

May '09 corn: I didn't get my sideways market like I thought I would today but we did hold support near my first number of $3.85 3/4 but I was off by $.05 on the upside for resistance. You will notice I said I was waiting for $3.76 1/2, which I still am but I do have a call spread in place in case I am wrong so we still have protection in place if the market moves higher. We didn't manage to close above the 50% retracement level of $3.95 1/4 so as of now this is still just a bounce, we need to close above $3.95 1/4 for a couple days before look to $4.07 as a target.

Bottom line: I am looking for the market to have follow through to the upside tomorrow and experience an early high and a late low. I look for support to be $3.93 1/4, $3.92 and $3.87 3/4. Resistance should show up at $3.95 1/4, $3.98 1/4 and $4.04. I expect the May '09 corn contract to open higher tonight and follow through with early strength and then meet resistance early.

MEAL - May ‘09 Electronic
Open - $312.80, High - $319.00, Low - $312.40, Close - $316.30 Up $3.20
Thoughts - Long Term (6 months) - Bullish/Higher

Yesterday I said: "I am looking for an early high and a late low tomorrow. Support for tomorrow looks like $311.40, $310.6 and finally $307.80. Resistance should be $315.00 and then $319.00 if the market gets enough steam to get there. Like I said earlier I am looking for an early high and a late low for tomorrow’s meal trade. We are nearing a cycle high in meal which would last until the middle of May ‘09; this is not a recommendation of any kind, just a stated observation."

May '09 meal: The early high did come in the first hour of trade today as well as the low in the last hour of trade but the low was still above my first support point and we nailed the resistance with my second number from yesterday. After making a high at $319.00 again today we have a small double top formation for the time being. I am still in the camp that meal looks toppy at this level and I don't want to be an aggressive owner of futures or cash at these levels. I have a majority of ownership via known risk call spreads which I intend to keep for the moment.

Bottom line: I'm looking for the market to have follow through to the upside tonight/tomorrow and experience an early high and a late low. I look for support to be $314.50, $313.50 and $312.10. Resistance should show up at $316.90, $319.00 and $325.20. I expect the May '09 meal contract to open higher tonight and follow through with early strength and then meet resistance early. **IF get above $319.00 either tonight/tomorrow or Thursday and move back below this level then I have a sell signal at $318.50 on the daily chart. If filled based on the sell signal then the protective buy stop order to manage risk would be $.50 above the current session high.** This is an observation only and it provides confidence in what the charts have already been saying at these levels, be careful if your long. As always please do what is right for your operation, take this information as insight not recommendation.

HOGS - June ‘09 GLOBEX
Open - $74.15, High - $74.25, Low - $72.45, Close - $72.60 Down $1.50
Thoughts - Long Term (6 months) - Friendly

Yesterday I said: "I am looking for an early high and a late low tomorrow as we are approaching the 15th of April and the May and June ‘09 contracts have a sizable lead on the cash index. I expect support to be $73.97, $73.72 and $73.35. I am looking for resistance to be $74.40, $74.82 and then $75.90 but I don’t expect this level to be touched tomorrow. I am looking for a near-term top in hogs this week and the beginning of a small retracement of the recent move higher."

June '09 hogs: I didn't do very well in projecting accurate support and resistance for today's trade but the market action projections were spot on with an early high and a late low. I know I know rocket science right? : ) All kidding aside, I don't think the June '09 hog contract has much upside left for the next week or so. I believe this is the beginning of a retracement in what should be a longer-term move higher.

Bottom line: I'm looking for the market to be higher tonight/tomorrow and experience an early high and a late low. I look for support to be $72.60, $71.95 and $71.05. Resistance should show up at $73.35, $73.55 and $74.25. I expect the June '09 hog contract to open higher tonight and follow through with early strength because of higher cash and cutout but falter as the day progresses. I am looking for a test of $70.52 within the next week if we close below $72.70 tomorrow in the June '09 contract.

NW_LS500
Des Moines, IA     Tue, Apr 14, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh loins firm to 5.00
higher; butts generally steady; sknd hams 17-20 lbs 2.00-4.00 lower from last
quote, other weights not established; sdls bellies not tested; lean trimmings
steady to 1.00 higher. Trading slow to moderate, with mostly moderate demand
and light to moderate offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :             86.88
Loads TRIM/PROCESS PORK  :              10.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/14        96.9      60.66   76.95   68.85  39.84 103.32 43.55  76.68
Change :                0.67    2.75   -0.30  -0.10  -0.64  0.12    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Apr 14, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .01 hgr   :   .26 hgr   :   .17 hgr   :   .24 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.75-57.23 : 48.50-57.09 : 48.50-57.23 : 46.75-56.08
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.19    :    55.74    :    55.86    :    54.27
--------------------------------------------------------------------------
Head Count      :   26,504    :   11,039    :   15,382    :   10,942
==========================================================================

Hog Comments - 04-13-09 - Hogs hold steady while feeds look for direction.

2009-04-13T16:39:00.001-05:00

It has been a while since my last post as my schedule has been crazy this past month, however, it looks like beginning this week I should have more of a normal schedule and get back to regular postings. I have been working on updating www.leanhog.net (which will now give you a "site under construction" page until I am finished) to provide you with more quality information that is accessible when you need it. I am excited about the new site and I hope you are too because I think you will enjoy it. I plan to have the updated site completed prior to the end of the month and maybe sooner rather than later as I have made good progress.

CORN - May '09 Electronic
Open - $3.90, High - $3.90 1/2, Low - $3.83, Close - $3.87 3/4 Down $.02 3/4.
Thoughts - Long Term (6 months) - Bullish/Higher

May '09 corn opened the day session on a weaker note with Crude Oil down over $3.00 a barrel and the Dow Jones off by more than 100 points. We still haven't cleared any area to make me extremely concerned about the drawback we've had in corn as a matter of fact it has been somewhat anticipated. I am only long 25% of needs with $2.80 puts in place to cover me to the downside; I also have a call spread on to the upside to make sure we have the coverage we need if I am wrong. I exited all of my long futures positions around $4.03 1/2 and re-entered 25% of them at $4.02 because the market didn't break as soon as I thought it would. I also placed some cheap call spreads in place last Thursday to get through the weekend and/or until I re-establish my long positions against my $2.80 puts.

I had orders in today to buy another 50% of my needs at $3.76 1/2 in the May '09 contract but we didn't get that low. We are now in the time-frame in which the corn market will be controlled to some degree by weather and planting progress. As of right now I am looking for a test of $3.76 in the May '09 contract and possibly a test of $3.68 1/2 if the weather stay's nice. Forecast's change and as of right now my cycle indicator says there isn't much to look forward to in the next couple of weeks in corn.

Bottom line - I am still bullish corn for reasons other than grain fundamentals, the U.S. Dollar Index was down 1.23 as I was writing this today and I am more concerned about the U.S. Dollar as a fundamental to corn than I am weather. Support for tomorrow's market looks like $3.85 3/4, $3.83 and then down to $3.76 3/4. Resistance should be $3.89 1/2, $3.90 1/2 and then up to $3.94. I am expecting a sideways market tomorrow, there were signs of bottom picking today and would suggest buy stops above $3.90 1/2 for tomorrow but I am not convinced of it yet. I am still cautious in the short-term at this price level but I am willing to begin scaling in purchases around $3.76 1/2 which will replace my long call spreads I talked about before.

MEAL - May '09 Electronic
Open - $311.10, High - $315.00, Low - $307.80, Close - $313.10 Up $1.90
Thoughts - Long Term (6 months) - Bullish/Higher

I said in one of my previous posts that I exited some of my meal because wanted to protect equity but would stop back into the market if I was wrong. I was wrong and therefore bought meal on about 40% of needs with futures against my long puts and then purchased a cheap call spread to give me coverage to the upside if the market makes an extended move. I am not sold on the idea the May '09 meal market is going to sky rocket from here but I know I am not smarter than the market. I see signs on the charts that tell me meal is looking for a top thus I have less aggressive ownership in futures and more in a know risk position. I had a sell signal in May '09 soybeans on Thursday at $10.23 1/2 which is still good even after today's action, it will be void if we touch $10.31 1/2 before a sell off.

Bottom line - I am looking for an early high and a late low tomorrow. Support for tomorrow looks like $311.40, $310.6 and finally $307.80. Resistance should be $315.00 and then $319.00 if the market gets enough steam to get there. Like I said earlier I am looking for an early high and a late low for tomorrow's meal trade. We are nearing a cycle high in meal which would last until the middle of May '09; this is not a recommendation of any kind, just a stated observation.

HOGS - June '09 GLOBEX
Open - $74.30, High - $74.425, Low - $73.725, Close - $74.10 Down $.175
Thoughts - Long Term (6 months) - Friendly

Thursday's higher cutout was obviously factored into Thursday's trade because there was very little enthusiasm in the June '09 contract today. The cutout for today was also higher by $.51 but the market failed to respond favorably in extended hour's trade. The June '09 contract has a cycle high approaching on Wednesday and then trends lower for nearly a week. The June '09 contract closed above what had been resistance of $73.85 on Thursday and continued with today's close at $74.10. The longer we stay above $73.85 the stronger our chances of rallying back toward $75.90, however, I think we will see $73.20 before we see $75.90.

The U.S. Dollar Index was very weak today and is still in a downward trend and I am expecting a test of the most recent low of $82.63 over the weeks ahead. If the U.S. Dollar Index continues to weaken we could see more bullishness appear in the hog sector. I am still short June '09 hogs with a call strategy in place to give me upside to $80.00 if the market should rally. I want good confirmation that the market is finished moving lower before I exit short positions especially when I have call coverage in place to provide upside protection.

Seasonal tendencies for market close on April 15th to the market close on May 1st are as follows since the year 2000 in June futures. There have been 4 years we have moved higher on average of $2.60 and 5 years when we move lower by an average of $2.18. Looks like it is pretty even BUT when you filter the data and only look for years that were above $70.00 June futures on the market close of April 15th the data changes. In this case there were 5 years since 2000 in which the June futures closed above $70.00 on April 15th for the respective year. In those years the market declined 4 times on average of $2.16/cwt or 80% of the time vs. the 1 year that it went up $1.275/cwt or 20% of the time. I know it isn't April 15th yet but I will probably wait to see what the market is trading at on the 15th before making any adjustments to positions.

Bottom line - I am looking for an early high and a late low tomorrow as we are approaching the 15th of April and the May and June '09 contracts have a sizable lead on the cash index. I expect support to be $73.97, $73.72 and $73.35. I am looking for resistance to be $74.40, $74.82 and then $75.90 but I don't expect this level to be touched tomorrow. I am looking for a near-term top in hogs this week and the beginning of a small retracement of the recent move higher.

NW_LS500
Des Moines, IA     Mon, Apr 13, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh bone-in loins not tested;
butts 3.00-4.00 higher; sknd hams 20-23 lbs 2.00 higher from last quote, other
weights not established; sdls bellies not tested; lean trimmings steady. Trading
slow, with light to moderate demand and light offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             22.75
Loads TRIM/PROCESS PORK  :               9.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/13        31.8      59.99   74.20   69.15  39.94 103.96 43.43  76.68
Change :                0.51   -0.09    2.72   0.13   1.57  0.85   0.02
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Apr 13, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .06 hgr   :   .64 lwr   :   .31 lwr   :  1.38 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.75-57.09 : 48.00-57.09 : 47.00-57.09 : 46.75-56.99
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.20    :    55.46    :    55.69    :    54.57
--------------------------------------------------------------------------
Head Count      :   13,144    :    5,254    :    7,102    :    5,849
==========================================================================

Hog Comments - 04-03-09 - Sorry no comments today.

2009-04-02T18:59:00.001-05:00

I am sorry but there will be no commentary today. If you have a question please shoot me an email and I will do my best to get back to you as soon as I can. My long term thoughts haven't changed from yesterday's post but it is evident my thoughts for today were off. I am looking for consolidation for now in the corn, soybeans and meal and hogs still need a test of $69.52 but cutout being up $1.13 today doesn't allow for a great chance for that to happen tomorrow. Early high in hogs tomorrow in my opinion and position evening going into the weekend in grains.

Jeremy

Hog Comments - 04-01-09 - A likely test of contract low's in June hogs tomorrow.

2009-04-01T17:00:00.000-05:00

CORN - May '09 Electronic
Open - $4.01 1/2, High - $4.02 1/4, Low - $3.93, Close - $3.96 Down $.8 3/4.
Thoughts - Long Term (6 months) - Bullish/Higher

As a review from yesterday I said "I expect to see an early high and a late low tomorrow as enthusiasm expires over today's USDA report findings. I look for early resistance tonight at $4.06-.07 then all the way up to $4.13 (don't think we will get there) and support should be $4.03, $3.99 3/4 and $3.96 1/2 but I think the $4.00 area should hold pretty good support. ***IF MAY '09 OPENS ABOVE $4.06 TONIGHT THAT WILL BRING A MORE NEGATIVE TONE TO TOMORROW THAT WHAT I HAVE DISCUSSED.*** I don't think we will open above $4.06 but I wanted to point it out if it does so you know what to expect from the market."

As stated above the enthusiasm from yesterday's acreage report seems to have run its course. I thought the $4.00 area would provide good support but not so. The crude oil market was down most of the day and the U.S. Dollar Index wasn't doing anything crazy so I attribute today's action to the corn market trading the corn market and nothing else. The May '09 contract broke through the low side of my support point today but closed at $3.96 just 1/2 cent off the support level. To no surprise it didn't reach my resistance level either because of the move we made yesterday.

I exited some short $3.60 May '09 put options today (it was the short side of a put spread against long futures) for $.03 just to take them off of the books and leave my long $3.80 put in place to leave the downside open if the market decides to turn and head south (unlikely). I am still in the camp of having good strategies in place to allow for upside participation in the market as I think we have a shot at testing $4.40 in the May '09 futures in the next 30 days.

Bottom line - Nothing happened today to make me think yesterday's rally was a fluke, as a matter of fact today's action was perfectly normal in my opinion. We retraced 50% of yesterday's move and held that support level which suggests we could make another run at the most recent high of $4.06 in the near future. I expect an early low and a late high tomorrow with support coming in at $3.93, $3.90 1/2 and resistance at $3.99 1/2, $4.01 and $4.06 and if we get excited $4.13 however I think it is unlikely for tomorrow.

MEAL - May '09 Electronic
Open - $293.00, High - $298.30, Low - $291.80, Close - $294.30 Down $1.00
Thoughts - Long Term (6 months) - Bullish/Higher

I said yesterday " the close on May '09 meal was a positive one today but like corn I think we may have gotten too excited to keep a strong rally like this going for two consecutive days. I'm looking for a steady to better open tonight only to find resistance at $296.40 then $298.70. Support should be around $293.20, $292.30 and $291.30. I am looking for an early high and a late low tomorrow in May '09 meal."

My support and resistance levels were much better in meal today than they were in corn. May '09 meal got within $.40 of my top resistance level and $.50 of my lowest support level. Like corn, May '09 meal retraced near 50% of yesterday's day session move and bounced from there. I still like the prospect of a higher meal market through time and want upside coverage in place as we move forward. That being said I exited my long meal contracts today at $294.80ish and will look to re-enter the market at a lower level if possible otherwise I will have my stop above the market to get back long if I'm wrong. I currently have a $280.00 May '09 put in place to protect downside risk on my futures (exited today) and that's what I will purchase against if the market gets to $284.00. $284.00 is just above a gap that was left in the hourly chart yesterday and they are typically a target to go back and fill.

Bottom line - I am still bullish meal and soybeans but I am still looking for a tad more downside in the May '09 meal contract. I expect an early low and a late high tomorrow with support coming in at $291.80, $288.1 and $285.50. I see resistance at $295.90, $296.40 and $298.30.

HOGS - June '09 GLOBEX
Open - $71.95, High - $72.50, Low - $70.925, Close - $71.45 Down $.95
Thoughts - Long Term (6 months) - Friendly

Reviewing yesterday I said "The market held just above my $70.52 support number and traded .52 above my high end resistance number and closed above it for the day. The issue I have with the market doing this today is its quarter/month end and strange things can happen on days like today. I am not buying into today's trade action just yet, because there is no evidence of a stronger cash market and cutout dropped by $.99 today. I look for an early high and a late low tomorrow with resistance at $72.725 then $73.20 and support should be at $71.45 and $70.675. Cutout was down today which is in line with what the short-term charts show for tomorrow, a negative trade day. Tomorrow is the cycle low but it is more of a general area it isn't a signal to buy so as I said yesterday I will continue to look for signs in the market that suggest the move lower is over."

Like I said it seems like funny things happen on the last day of the month and especially the quarter in some markets particularly the hog market. Today confirmed that thought with June '09 giving back most of its gains from yesterday. Cash hogs are still in the toilet and the prospects of higher prices don't look that great at the moment and cutout has shown us over the course of two days that product isn't moving that well either. I remain hedged with upside potential to $80.00 in the June '09 contract. I am looking for signs of a market bottom but they are not showing up we didn't buy into the head fake the market gave us yesterday.

Bottom line - I'm looking for June '09 to continue lower tomorrow and I am expecting an early low AND high, I think the high and low of the day session will be during the first hour of trade tomorrow. The cutout was down $1.69 (I wish it were an April Fool's joke!) today so I expect nerves of those that are long to be on high alert and just puke out of positions as we can easily make new contract lows tomorrow. I am looking for a test of $69.52 tomorrow and I will need to see how we close tomorrow to decide if my cycle low this week is going to have any merit. Support in June '09 hogs for tomorrow should be $70.675, $69.52 then limit lower at $68.45. Resistance should be $71.52 and $71.70 but I don't think we will touch either of them, tomorrow could be ugly.

NW_LS500
Des Moines, IA     Wed, Apr 01, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh 1/4" trim loins firm;
butts steady to 1.00 lower; sknd hams 1.00 lower; sdls bellies 14-16 lbs 1.00
lower; lean trimmings not established. Trading mostly moderate, with moderate
demand and moderate to heavy offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :            126.38
Loads TRIM/PROCESS PORK  :               1.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
04/01       127.4      55.00   66.26   62.59  39.61  98.36 36.39  74.90
Change :               -1.69   -4.46    0.03  -0.20   0.64 -1.97  -0.49
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Apr 01, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .31 lwr   :   .10 lwr   :   .54 lwr   :   .02 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 45.25-59.26 : 45.25-59.26 : 45.25-59.26 : 45.50-58.11
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    56.23    :    57.35    :    56.94    :    54.66
--------------------------------------------------------------------------
Head Count      :   24,765    :   11,167    :   16,568    :    7,827
==========================================================================

Hog Comments - 03-31-09 - Feed grains higher with new highs in sight?

2009-03-31T15:42:00.030-05:00

CORN - May '09 Electronic
Open - $3.86, High - $4.06, Low - $3.81 1/4, Close - $4.04 3/4 Up $.18 1/2.
Thoughts - Long Term (6 months) - Bullish/Higher

Reviewing yesterday's comments I said "USDA report out tomorrow so that will trump any direction I have if there is a surprise. The trade is looking for corn acres to be around 86 million so anything less (85 or less in my opinion) will be positive to corn prices and I look for trade to give us an early low and a late high. Support in May '09 corn tomorrow should be $3.82, $3.81 and $3.76 3/4 while resistance should be $3.87 1/4, $3.89 1/2 then $3.92. I had a buy signal at $3.85 today with a risk management sell stop at $3.75 1/2. Market action today suggests a probable reversal to the upside tomorrow with buy stops above today's high's of $3.89 1/2."

CORRECTION - I said yesterday the trade was looking for corn acres to be 86 million when in fact it they were looking for 84.4 million acres for this year's intentions. 86 million was last year's actual plantings, my apologies.

The May '09 contract got within 1/4 cent of my mid range support level today and shattered the top end of my resistance level. As I have said for a while I want my core position in corn to be a bullish biased position to protect against moves like today. I said anything below 85 million acres should be viewed as positive by the trade and today's number was just a shade below 85 million acres. The market also responded the way the chart's suggested by having an early low and a late high today.

Today's close was a good one; the funds purchased approximately 10,000 contracts of corn and managed to close above the 62% retracement level of $4.03 in the May '09 contract. I am looking for a steady to higher opening tonight and then find resistance around $4.06 to $4.07. I expect the market to retrace some of today's gains during tomorrow's trade but bottom line is if we close above $4.03 tomorrow then we could be on our way to the number I have talked about for a couple of weeks, $4.40. We closed above what has been good resistance at $4.00 now we just need to make sure it was for real. Make sure you have some type of option coverage in place to the upside, talk with your broker about a strategy that is right for you and your operation.

Today was an event day as I like to call it. I like to sit back and watch other people trade on "event days" as a matter of fact report days make for good vacation days. Huh? My point is prepare yourself going into reports or events and know your risk therefore you need not "worry" about the news that is released and have to make decision based on emotion. With this being said I think most of the people who react to news instead of prepare for it were the ones in buying today to drive the market up as much as it was. This is fine because in the end I think buying is the right thing to do but we could see a setback tomorrow.

Bottom line - I expect to see an early high and a late low tomorrow as enthusiasm expires over today's USDA report findings. I look for early resistance tonight at $4.06-.07 then all the way up to $4.13 (don't think we will get there) and support should be $4.03, $3.99 3/4 and $3.96 1/2 but I think the $4.00 area should hold pretty good support. ***IF MAY '09 OPENS ABOVE $4.06 TONIGHT THAT WILL BRING A MORE NEGATIVE TONE TO TOMORROW THAT WHAT I HAVE DISCUSSED.*** I don't think we will open above $4.06 but I wanted to point it out if it does so you know what to expect from the market.

MEAL - May '09 Electronic
Open - $281.50, High - $296.40, Low - $281.00, Close - $295.30 Up $13.80
Thoughts - Long Term (6 months) - Bullish/Higher

I said yesterday "I am looking for an early low and late high with support at $277.60 and $275.10 and resistance at $282.20 and $285.00. Looking for the USDA report to give us direction tomorrow but I believe we will see positive trade based on the USDA numbers. This thought is solely based on the way the SHORT TERM charts look to me as well as the expected weakness in the U.S. Dollar Index. The dollar thing is a big deal guys."

Meal didn't get down to my support levels from yesterday and it blew through my resistance levels but the charts were right with positive trade today as a result of the USDA numbers. The planting intention report only increased soybean acres by 324,000 acres when the trade was looking for approximately 3.9 million more acres than last year. It is still a good time to have a known risk strategy in place to prevent you from paying higher prices in meal, talk with your broker about a strategy that is right for you.

Bottom line - the close on May '09 meal was a positive one today but like corn I think we may have gotten too excited to keep a strong rally like this going for two consecutive days. I'm looking for a steady to better open tonight only to find resistance at $296.40 then $298.70. Support should be around $293.20, $292.30 and $291.30. I am looking for an early high and a late low tomorrow in May '09 meal.

HOGS - June '09 GLOBEX
Open - $70.95, High - $72.725, Low - $70.675, Close - $72.40 Up $1.425
Thoughts - Long Term (6 months) - Friendly

Reviewing yesterday I said "as I mentioned above I will continue to look for signs in the market to make me look at adjusting my short positions in the market place. In an effort to find a patter for the next couple of weeks based on the market tendencies since the year 2000; it seems as if the risk is more to the upside than to the downside. I am looking for an early low and a late high tomorrow; cutout was a non-event today as it was up $.14. I look for support at $70.52 and $69.52 and resistance should be around $71.35, $71.575 and then $72.20."

The market held just above my $70.52 support number and traded .52 above my high end resistance number and closed above it for the day. The issue I have with the market doing this today is its quarter/month end and strange things can happen on days like today. I am not buying into today's trade action just yet, because there is no evidence of a stronger cash market and cutout dropped by $.99 today.

Bottom line - I look for an early high and a late low tomorrow with resistance at $72.725 then $73.20 and support should be at $71.45 and $70.675. Cutout was down today which is in line with what the short-term charts show for tomorrow, a negative trade day. Tomorrow is the cycle low but it is more of a general area it isn't a signal to buy so as I said yesterday I will continue to look for signs in the market that suggest the move lower is over.

NW_LS500 **Resent for correction to strap ons and offs and cutout**
Des Moines, IA     Tue, Mar 31, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:
                                    Fresh 1/4" trim loins 7.00 to
8.00 lower; butts 1.00-3.00 higher; sknd hams 20-27 lbs 2.00-4.00 lower; sdls
bellies 14-16 lbs 2.00 lower; lean trimmings weak to 4.00 lower. Trading
active, with mostly moderate demand and moderate to heavy offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :            137.37
Loads TRIM/PROCESS PORK  :               9.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/31       146.4      56.69   70.72   62.55  39.80  97.72 38.37  75.39
Change :               -0.99    1.39    0.85  -0.73   1.53 -5.00  -1.03
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Mar 31, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .08 hgr   :   .34 hgr   :   .08 hgr   :   .21 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 45.25-60.00 : 46.00-60.00 : 45.25-60.00 : 45.50-56.08
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    56.46    :    57.45    :    57.51    :    54.64
--------------------------------------------------------------------------
Head Count      :   25,072    :   13,267    :   15,886    :    9,186
==========================================================================

Hog Comments - 03-30-09 - Hogs may be looking for a bottom.

2009-03-30T15:43:00.002-05:00

CORN - May '09 Electronic
Open - $3.87 3/4, High - $3.89 1/2, Low - $3.76 3/4, Close - $3.86 1/4 Down $.00 3/4.

Thoughts - Long Term (6 months) - Bullish/Higher

Today was interesting considering we have the USDA March planting intentions report due out tomorrow morning. May '09 corn was down $.05 in the overnight session then opened the day session made an early low and closed near its high for the day session. I was surprised to see the corn market as strong as it was with crude oil being down over $4.00/barrel today.

I made a comment on how weak the U.S. Dollar Index has been after the Government said they were going to buy toxic assets from the banks. Since my comments the dollar has risen and made near a 50% retracement of its most recent decline which is normal. I am still of the opinion the dollar is heading south which is obviously good for the commodities markets. I want to keep a bullish structure to any positions I have on for feed. As of right now I'm long futures with a $3.80-$3.60 put spread in place on the May '09 contract. The put strategy allows us to be long the market without getting clobbered if we are wrong.

Bottom line - USDA report out tomorrow so that will trump any direction I have if there is a surprise. The trade is looking for corn acres to be around 86 million so anything less (85 or less in my opinion) will be positive to corn prices and I look for trade to give us an early low and a late high. Support in May '09 corn tomorrow should be $3.82, $3.81 and $3.76 3/4 while resistance should be $3.87 1/4, $3.89 1/2 then $3.92. I had a buy signal at $3.85 today with a risk management sell stop at $3.75 1/2. Market action today suggests a probable reversal to the upside tomorrow with buy stops above today's high's of $3.89 1/2.

MEAL - May '09 Electronic
Open - $284.30, High - $285.50, Low - $277.70, Close - $281.50 Down $2.30

Thoughts - Long Term (6 months) - Bullish/Higher

As you may have noticed I have added a my long term thoughts in black and white just below the market close on each commodity I talk about. I try to give a longer-term directional feel to the market but I may forget it sometimes and if you follow along with my comments my short-term commentary can easily be contrary to my long term feel. I am trying to make my thoughts more clear to you so please let me know if you have suggestions and thanks to those who have.

Today's low of $277.70 was within $.10 of the 62% retracement of the recent move higher. The May '09 contract needs to get back above $283.60 for a couple of days before we look to make another run toward $308.90. I have the same thoughts on meal as I do on corn, I think we will see an early low and a late high tomorrow but remember any surprises in from the USDA and all bets are off.

Bottom line - I am looking for an early low and late high with support at $277.60 and $275.10 and resistance at $282.20 and $285.00. Looking for the USDA report to give us direction tomorrow but I believe we will see positive trade based on the USDA numbers. This thought is solely based on the way the SHORT TERM charts look to me as well as the expected weakness in the U.S. Dollar Index. The dollar thing is a big deal guys.

HOGS - June '09 GLOBEX
Open - $70.60, High - $71.20, Low - $70.525, Close - $70.975 Down $.425

Thoughts - Long Term (6 months) - Friendly

The market was trading the Quarterly Hog & Pig report from Friday which was evidently mildly bearish according to today's trade. I am looking for a place to lighten my short position this week if the charts suggest we do so. I have been saying for awhile in my comments that I have a cycle low near the end of March which I still do. I will be looking for signs and signals that suggest a bottom and look to re-structure my short positions when I see these signs. Today is the first one; we opened the market below Friday's low and rallied off of the open. The day and potential signal started out okay but failed to close above the crucial Friday low so I will keep looking.

In doing my research it tells me that June futures move lower from the close of April 1st to the close of April 15th 44.5% of the time by an average of $2.86/cwt and up 55.5% of the time by an average of $3.23/cwt. I talk about June because I am no longer using April '09 as a hedge vehicle which makes sense as the June has dropped near $3.00/cwt more than April since the week of March 16th (from high to low of the spread).

Bottom line - as I mentioned above I will continue to look for signs in the market to make me look at adjusting my short positions in the market place. In an effort to find a patter for the next couple of weeks based on the market tendencies since the year 2000; it seems as if the risk is more to the upside than to the downside. I am looking for an early low and a late high tomorrow; cutout was a non-event today as it was up $.14. I look for support at $70.52 and $69.52 and resistance should be around $71.35, $71.575 and then $72.20.

NW_LS500
Des Moines, IA     Mon, Mar 30, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh 1/4" trim loins not reported;
boston butts 2.00 higher in a light test;  sknd hams 17-20 lbs 1.00 lower, 23-27 lbs
3.00 lower, 23-27 lbs 1.00 lower; sdls bellies 14-16 lbs 2.00 lower; lean trim steady to
1.00 lower. Trading slow, with light demand and mostly moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             33.75
Loads TRIM/PROCESS PORK  :              10.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/30        43.8      57.68   69.33   61.70  40.54  96.19 43.37  76.41
Change :                0.14    0.92    0.62  -0.03  -0.81  0.19  -1.00
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Mar 30, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .08 hgr   :   .04 lwr   :   .15 hgr   :   .44 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 45.50-59.80 : 46.00-59.80 : 46.00-59.80 : 45.50-59.50
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    56.28    :    57.00    :    57.37    :    54.85
--------------------------------------------------------------------------
Head Count      :   23,625    :    8,339    :   13,266    :   10,269
==========================================================================

Hog Comments - 03-26-09 - I'm still negative the hog market for now.

2009-03-26T15:43:00.000-05:00

It has been a week since my last post due to my schedule and illness. I will refer to my previous comments as a starting point.

CORN - May '09 Electronic
Open - $3.86, High - $3.92, Low - $3.86, Close - $3.90 3/4 Up $.05

As a review from my last post (03-16-09) I said "The May '09 contract made it through the upside target of $3.92 and looked like it had a great shot at testing the $4.03 number I wrote about last week too but it didn't get the job done as it stalled out at $3.97 1/2. I am still of the opinion we could test $4.40 in the May '09 contract IF we get closes above $3.92 for a couple of days this week and especially on Friday. I have one thing I am watching right now and it is a potential sell signal at $3.89 on a stop order. If the order would be executed there should be a buy stop at $3.98 1/2 to manage risk in the position."

As I mentioned in the paragraph above, the May '09 contract needs to get back above $3.92 in my opinion and hold that level for a day or two before we have a valid shot of testing $4.40 in the May '09 contract. I am a longer-term bull for the corn market especially after the Government said they will buy $1 Trillion of toxic assets which killed the dollar last week. I believe we are going to see the corn (commodities) markets move more off of money flow than fundamentals.

From here on out I want to structure any position I have with a bullish tone for reasons that have nothing to do with fundamentals of the corn market. I think the market will once again be technically driven especially if the U.S. Dollar index continues its recent decline.

Bottom line - I expect corn to have an early high and a late low tomorrow. I expect Resistance to be $3.91 3/4 then $3.92 3/4 and support is projected at $3.89, $3.88 1/4 and $3.87 1/4. The $3.92 area has been like a magnet for the May '09 contract but hasn't moved very far in either direction. I am bullish corn long-term and will hold my feed coverage in place with known risk strategies but tomorrows action my provide enthusiasm early and then the market should weaken.

MEAL - May '09 Electronic
Open - $294.30, High - $298.70, Low - $289.40, Close - $290.80 Down $3.50

I will review my comments from my last post on March 16th, 2009; I said "My opinion hasn't changed much from a longer-term perspective and I believe ownership is needed in some form at these levels. I would still like to leave the downside open if possible which points to using options however do what is best for your operation. I am looking for downside pressure tomorrow with support at $284.10 and $282.70 with an ultimate target of $278.20 but I don't think we will get there tomorrow. Resistance should be at $290.10 and $291.60. I expect an early high and a late low but noting to get too excited about to the downside."

My short-term call of $278.20 was off last week as the market never did move that low, the lowest we got was $284.40 which was just above the first level of support from my comments. The May '09 meal contract filled a gap that was left on March 18th, 2009 at $290.80 which is exactly where we closed today. I am a longer-term bull in meal as a result of my U.S. Dollar index comments written in the corn commentary above.

Bottom line - it looks like the May '09 meal contract is looking for an early low and a late high tomorrow, opposite of corn. I expect support to be $289.40, $286.70 and resistance at $294.10, $295.10 and finally $298.70. I don't think $298.70 is attainable tomorrow but it is still the next level of resistance according to my studies.

HOGS - June '09 GLOBEX
Open - $71.80, High - $72.45, Low - $71.40, Close - $71.775 Down $.95

I will review my post from March 16th, 2009; I said "I am still looking for a run lower in the June '09 contract. $72.475 is a target that I believe we can touch at some point in the near future. Unless cash hogs start to move again it just adds to my negative bias that the chart have been showing for days. My cycle indicator has June '09 hogs trending lower until March 28th before finding a bottom. I do not follow my cycle indicator solely but it is a part of my decision making process. Support for June '09 tomorrow is $73.50, $73.10 and $72.47. Resistance should be $74.425, $74.67 and $75.37. I expect tomorrow to have an early high and a late low with $73.10 having a good chance of being tested."

The high on the 17th was $74.20 and the low was $73.22 so I was $.22 off on the resistance number and .12 off on the support number for trade on the 17th. The market moved higher before it went lower since my last comments but the bottom line is the market backed off like the charts said it should. I am still have a negative feel toward June '09 hogs for the time being but we have the Quarterly Hog & Pig report out at 2:00 p.m. CST tomorrow which could switch directions with a major surprise however I don't see it.

$71.95 is a key number for me in June '09 hogs, if we close below it again tomorrow then I look for a test of $69.52 in the June contract however the Pig Report could be a wild card event. If the market gaps lower tomorrow below $71.40 and then trades back above $71.40 it would signal a buy on the candlestick charts at $71.65 on a buy stop only. If the buy stop it filled then a risk management sell stop should be place $.25 below the most recent low for the day. I will not buy the hog market based on this signal, I need to see more than this potential signal.

Bottom line - I am looking for an early low in June '09 hogs tomorrow and then strengthen as the day progresses. The cycle indicator still has the market moving lower into the first part of next week before finding support. Support for tomorrow is $71.40, $70.85 then all the way down to $69.52 but I don't think we get there. Resistance for tomorrow should be $72.10, $72.32 and $72.52.

NW_LS500
Des Moines, IA     Thu, Mar 26, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh loins unevenly steady;
butts steady; sknd hams 2.00-3.00 lower; sdls bellies 14-16 lbs 2.00 lower; lean
trimmings weak to 4.00 lower. Trading moderate, with light to moderate demand
and mostly moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             109.0
Loads TRIM/PROCESS PORK  :              26.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/26       135.0      57.28   68.35   58.86  41.00  96.99 43.26  77.41
Change :               -0.58    0.33    2.02   2.16   1.98 -2.15  -4.39
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Mar 26, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .25 hgr   :   .27 hgr   :   .39 hgr   :   .07 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 45.50-58.11 : 46.00-58.11 : 46.00-58.11 : 45.50-55.41
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.64    :    56.48    :    56.54    :    53.71
--------------------------------------------------------------------------
Head Count      :   26,173    :   11,986    :   17,820    :    7,968
==========================================================================

Hog Comments - 03-16-09 - I'm still bearish hogs...

2009-03-16T18:45:00.000-05:00

CORN - May '09 Electronic
Open - $3.84 1/2, High - $3.97 1/2, Low - $3.81 1/2, Close - $3.91 1/2 Up $.03

Reviewing my comments from my last post on Thursday the 12th of March, I said "I have been saying for quite some time that I am not a bear at these levels but now we have made some major strides to begin to confirm this thought. I wanted to see the market get above $3.68 before I got excited about a major rally and we obviously closed well above that today. IF YOU DO NOT HAVE FEED CORN PROTECTION IN PLACE I WOULD AT MINIMUM BUY SOME OUT OF THE MONEY CALL OPTIONS!!! We have finally broken our downtrend line that descends from our January '09 high and we have closed above it for the fifth consecutive day. If we manage to close May '09 corn above $3.92 tomorrow or by next Friday then my next target is $4.40 May '09 corn."

The May '09 contract made it through the upside target of $3.92 and looked like it had a great shot at testing the $4.03 number I wrote about last week too but it didn't get the job done as it stalled out at $3.97 1/2. I am still of the opinion we could test $4.40 in the May '09 contract IF we get closes above $3.92 for a couple of days this week and especially on Friday. I have one thing I am watching right now and it is a potential sell signal at $3.89 on a stop order. If the order would be executed there should be a buy stop at $3.98 1/2 to manage risk in the position.

Bottom line - I see the signal at $3.89 as a good possibility which could give us a chance to move lower and give back some of this move. I do not think the market is done I just believe we will see a pull back. The overnight just opened as I write this and the signal was good at $3.89 which is where we opened the session. If $3.97 1/2 is breached then the signal has failed and it is onward and upward. I am expecting a test of $3.87 1/2 to $3.81 1/2 tomorrow with the upside targets at $3.97 1/2 but I believe we will be lower tomorrow. I expect an early high and late low for tomorrow's trade.

MEAL - May '09 Electronic
Open - $273.70, High - $290.00, Low - $272.50, Close - $288.40 Up $11.70

As a review from Thursday of last week I said "Not much different from the corn, the market was close to my first support level of $268.20 but above my resistance level by $3.50. I missed exiting my short meal futures yesterday by $.10 which made for a tough pill to swallow today when I exited for a profit of around $.30 on the position. I exited because I need upside coverage for meal and I only sold the futures so I wouldn't lose all of the equity in my $280.00 April call option. I made a mistake, I said yesterday the April call expires next Friday but it is the following Friday the 27th. Like corn, IF YOU DON'T HAVE MEAL COVERAGE IN PLACE WITH A KNOWN RISK STRATEGY I WOULD STRONGLY SUGGEST AT MINIMUM BUYING AN OUT OF THE MONEY CALL but talk with your broker to make sure it is right for your operation."

Bottom line - My opinion hasn't changed much from a longer-term perspective and I believe ownership is needed in some form at these levels. I would still like to leave the downside open if possible which points to using options however do what is best for your operation. I am looking for downside pressure tomorrow with support at $284.10 and $282.70 with an ultimate target of $278.20 but I don't think we will get there tomorrow. Resistance should be at $290.10 and $291.60. I expect an early high and a late low but noting to get too excited about to the downside.

HOGS - June '09 GLOBEX
Open - $73.95, High - $74.60, Low - $73.65, Close - $74.075 Down $.15

As a review from last Thursday I said "I am still negative the hog market however I did add a call strategy to my short futures today because as I have said before, what I think and what the market does are two very different things! I have upside in the June '09 contract up to $80.00 before I need to adjust my position. I will stay with my negative bias toward the market until we close above $74.30 for at least two days and have sold trade action above it. The weekly chart is showing signs of caution if you were long the market but I need to see tomorrow's close to be sure and it is a caution sign not a sell signal. "

My opinion has NOT changed in June '09 hogs. As mentioned in the paragraph above I will remain negative to the hog market until we get a close above $74.30 in the June '09 contract for at least two days, it has yet to happen. Friday's trade action on the chart looked very negative to me, however, I expected follow through to the downside today which we got very little of. The cash market isn't in the best of shape but packer margins have since come around with last week's run in cutout and general weakness in cash.

Bottom line - I am still looking for a run lower in the June '09 contract. $72.475 is a target that I believe we can touch at some point in the near future. Unless cash hogs start to move again it just adds to my negative bias that the chart have been showing for days. My cycle indicator has June '09 hogs trending lower until March 28th before finding a bottom. I do not follow my cycle indicator solely but it is a part of my decision making process. Support for June '09 tomorrow is $73.50, $73.10 and $72.47. Resistance should be $74.425, $74.67 and $75.37. I expect tomorrow to have an early high and a late low with $73.10 having a good chance of being tested.

NW_LS500
Des Moines, IA     Mon, Mar 16, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh bone-in loins steady;
butts steady to 1.00 lower; sknd hams 20-23 lbs 2.00 lower, 23-27 lbs unevenly
steady; sdls bellies not established; lean trimmings 2.00 higher. Trading slow,
with light to moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             40.00
Loads TRIM/PROCESS PORK  :               9.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/16        49.0      59.51   74.39   62.83  36.27  96.65 43.98  81.63
Change :               -0.04   -0.74   -0.91   1.99  -0.03  0.04   0.10

-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Mar 16, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.58 lwr   :  2.53 lwr   :  2.38 lwr   :   .61 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.75-58.11 : 47.25-57.00 : 44.75-57.00 : 46.00-58.11
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.65    :    55.24    :    55.41    :    55.97
--------------------------------------------------------------------------
Head Count      :   17,397    :    5,884    :    9,651    :    7,297
==========================================================================

Hog Comments - 03-12-09 - Third straight day of higher cutout!

2009-03-12T15:24:00.000-05:00

CORN - May '09 Electronic
Open - $3.64, High - $3.86 3/4, Low - $3.62 3/4, Close - $3.85 1/4 Up $.20 3/4

As a review from yesterday I said "The May '09 futures settled at $3.64 1/2 which is 1/4 cent above the 50% retracement level from our most recent low to our most recent high. This area should provide support and if it doesn't we should see $3.59 1/2, $3.58 and $3.55 1/2. I am looking for more weakness in the overnight and early day session tomorrow. I expect a test of $3.59 1/2 at some point between tonight and tomorrow's close. Support for May '09 corn is $3.62, $3.59 1/2 and $3.58. Resistance is $3.66 3/4, $369 1/4 and $3.71 1/2. I expect an early low and a late high tomorrow."

We didn't see a test of the $3.59 1/2 area like I thought we would but we did hold my first level of support at $3.62. Once again the market blew through my resistance levels with no problems at all but the market action was exactly what I thought it would be an early low and a late high. I purchased corn today at $3.79 which is higher than I would have liked but discipline said I needed to. I also moved my put options from $3.60 to $3.80 to protect the downside risk of my long futures positions so now I have near a full position on in feed corn to protect me to the upside if the market continues its climb. Rumor today is that a large, well followed firm will decrease its corn acreage estimate and therefore got the market going to the upside along with favorable outside market conditions.

I have been saying for quite some time that I am not a bear at these levels but now we have made some major strides to begin to confirm this thought. I wanted to see the market get above $3.68 before I got excited about a major rally and we obviously closed well above that today. IF YOU DO NOT HAVE FEED CORN PROTECTION IN PLACE I WOULD AT MINIMUM BUY SOME OUT OF THE MONEY CALL OPTIONS!!! We have finally broken our downtrend line that descends from our January '09 high and we have closed above it for the fifth consecutive day. If we manage to close May '09 corn above $3.92 tomorrow or by next Friday then my next target is $4.40 May '09 corn.

Bottom line - Huh, where do I start? If we open BELOW $3.86 3/4 tonight it will be a good open for follow through to the upside but if we open above that then there would be a sell signal at $3.86 that might be attractive based on the reasons why the market rallied. Rumors that corn acres will decrease. Again, I am not bearish here but the market rallied off of rumors so those that are in are already in and will probably sell to those who get in late tomorrow if the rumor is true. My cycles tell me to look for an early high and a late low tomorrow (short-term) but market action looks strong. I will go with follow through to the upside tomorrow ONLY if we open below $3.86 3/4 tonight. SUPPORT should be $3.81, $3.78 then $3.75 and RESISTANCE should be $3.92, $4.03 then $4.08 1/2. I think $3.92 is a possibility for tomorrow but I believe our highs will be in early in the day.

MEAL - May '09 Electronic
Open - $270.00, High - $276.40, Low - $268.60, Close - $276.50 Up $7.00

Reviewing yesterday I said "I am looking for continued weakness in May '09 meal tonight/tomorrow but I think we will see an early low and late high. We are having a tough time closing above $271.00 to get anything going to the upside. Support for May '09 meal should be $268.20, $267.20 and then $265.10. Resistance should be $271.20, $272.10 and then $273.00. I expect early lows and late highs tomorrow."

Not much different from the corn, the market was close to my first support level of $268.20 but above my resistance level by $3.50. I missed exiting my short meal futures yesterday by $.10 which made for a tough pill to swallow today when I exited for a profit of around $.30 on the position. I exited because I need upside coverage for meal and I only sold the futures so I wouldn't lose all of the equity in my $280.00 April call option. I made a mistake, I said yesterday the April call expires next Friday but it is the following Friday the 27th. Like corn, IF YOU DON'T HAVE MEAL COVERAGE IN PLACE WITH A KNOWN RISK STRATEGY I WOULD STRONGLY SUGGEST AT MINIMUM BUYING AN OUT OF THE MONEY CALL but talk with your broker to make sure it is right for your operation.

Bottom line - We close above the $270.70 number I have talked about for awhile now so our next number to get to is $281.20 and if we can sustain trade above this number then could search out $325.30 again. There are a lot of what ifs in that last sentence but that is how I see it developing. Similar to corn the market needs to open up lower tonight to prevent a sell signal from forming. If the May '09 meal opens higher (the higher the more bearish) tonight then there were be a sell signal at $276.00 on a stop with a risk management buy stop above the most current high to exit the trade if the signal is false. I like the way we closed but I don't like that it was at the very high. I am expecting an early high tomorrow and late low unless we get a big fundamental surprise. SUPPORT should be $$274.40, $272.40 then $268.20 and RESISTANCE should be $277.30, $281.20 then $283.90.

HOGS - June '09 GLOBEX
Open - $72.35, High - $73.90, Low - $72.25, Close - $73.75 Up $1.35

Reviewing yesterday I said "with packer margins still in the red I continue to have a negative bias toward the market because today's action didn't tell me much from a chart perspective. We closed back above the $71.90 number I spoke of yesterday so we need to continue to watch this level to give us further direction. Cutout was up $.98 today and it was up $.82 yesterday so we've had back to back days of higher cutout numbers which will be psychologically supportive to the market. I look for early strength in the market based off of tonight's cutout number but I believe we will have early highs and late lows. Support for June '09 should be $72.175, $71.70 then $71.47. Resistance should be $72.675 then $73.25. I am still not friendly hogs at these levels and I have a cycle high being put in tomorrow and then a lower trend into approximately March 27th. Again I'm looking for early highs and late lows tomorrow."

I am eating my words today but I have to be honest with myself as well as you the reader and review what took place. I thought we would see early highs and late lows however it was pretty much the opposite today. I knew the market would be supported today because of two consecutive days of strength in cutout but I didn't anticipate the market to hold firm as long as it did. I will say that now that the Goldman roll is complete we should get back to a functional market. I have found that during the periods of this roll the market does strange things because they need to roll their long positions from the front month to the next and they are very good at getting this done.

I am still negative the hog market however I did add a call strategy to my short futures today because as I have said before, what I think and what the market does are two very different things! I have upside in the June '09 contract up to $80.00 before I need to adjust my position. I will stay with my negative bias toward the market until we close above $74.30 for at least two days and have sold trade action above it. The weekly chart is showing signs of caution if you were long the market but I need to see tomorrow's close to be sure and it is a caution sign not a sell signal.

Bottom line - I am looking for an early high and a late low in June '09 tomorrow. On an hourly chart I have a sell signal at $73.90 STOP IF the market trades higher than that and comes back down through this level, the risk management buy stop would be $.25 above the current high if filled. SUPPORT should be $73.27, $73.07 then $72.85 and RESISTANCE should be $73.90, $74.15-30 then $74.85. I expect an early high and late low tomorrow.

I wrote my comments prior to seeing cutout and cash but when the information was released from the USDA the globex futures didn't do much. Hmmmmm what do they have up their sleeve? Did we see all the buying today and the insiders will sell it tomorrow based off of the big cutout number? I smell something here, I will leave my comments as is.

NW_LS500
Des Moines, IA     Thu, Mar 12, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh 1/4" tirm loins 1.00
higher; butts steady to 1.00 lower; sknd hams 23-27 lbs steady to 1.00 higher,
other weights not tested; sdls bellies 14-16 lbs not tested, other weights firm;
lean trimmings 3.00 higher. Trading slow, with light to moderate demand and
mostly light offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :             57.13
Loads TRIM/PROCESS PORK  :               6.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/12        63.1      58.70   74.36   64.12  34.10  96.68 44.44  76.65
Change :                1.62    0.68    0.40   1.78  -0.32  4.36   0.97
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Mar 12, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .05 lwr   :   .87 hgr   :   .59 hgr   :  2.07 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 45.50-62.00 : 47.00-62.00 : 46.00-62.00 : 45.50-60.14
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    59.20    :    60.80    :    60.71    :    55.99
--------------------------------------------------------------------------
Head Count      :   24,382    :   11,690    :   16,605    :    7,777
==========================================================================

Hog Comments - 03-11-09 - Hogs respond to yesterday's higher cutout.

2009-03-11T15:53:00.000-05:00

CORN - May '09 Electronic
Open - $3.74 1/2, High - $3.81, Low - $3.62, Close - $3.64 1/2 Down $.11

Reviewing yesterday's comments I said "I am still looking for a place to buy May '09 corn against $3.60 put options as the market didn't get to my target levels over the past couple of days. We have now traded substantially above the downtrend line in the May '09 contract and I look for a close above $3.68 for a couple of days before getting extremely excited about a major rally. Support for tomorrow is $3.74 $3.71 3/4, $3.69 and resistance should be $3.81 1/4 and then $3.84. The market created a sell signal at $3.79 1/2 in the May '09 contract today with a protective buy stop at $3.85."

As stated above the $3.79 1/2 sell signal in May '09 corn was quiet good. I have been looking to purchase futures against $3.60 puts for the last several sessions but we haven't gotten to an area where I am comfortable putting them on. My resistance number at $3.81 1/4 for today was good within a 1/4 cent but I was off on my support levels. I had orders in at $3.64 this morning but then moved them down to $3.58 to see if we could touch it but I really wanted to see the market close today before getting long futures. It is still my intent to get ownership in the May '09 contract but I plan to buy below today's closing price.

Bottom line - The May '09 futures settled at $3.64 1/2 which is 1/4 cent above the 50% retracement level from our most recent low to our most recent high. This area should provide support and if it doesn't we should see $3.59 1/2, $3.58 and $3.55 1/2. I am looking for more weakness in the overnight and early day session tomorrow. I expect a test of $3.59 1/2 at some point between tonight and tomorrow's close. Support for May '09 corn is $3.62, $3.59 1/2 and $3.58. Resistance is $3.66 3/4, $369 1/4 and $3.71 1/2. I expect an early low and a late high tomorrow.

MEAL - May '09 Electronic
Open - $271.60, High - $276.00, Low - $268.20, Close - $269.50 Down $1.80

Reviewing yesterday's comments I said "I am looking for tonight/tomorrow's trade to open on weaker tone and test support at $269.20 to $268.00 before finding support. As I said above we need to see the market continue to close above $270.50 before I think we can make a bigger move higher. If you don't have upside protection in place I would make sure you visit with someone who can help you with this need. Support for tomorrow is $269.20, $268.00 then $264.40 and resistance is $272.30 and $273.90."

Support for May '09 meal was $.20 away from my lowest support level from yesterday and the resistance point was under estimated by $2.10. I sold futures at $274.40 against my $280.00 call options today because they expire on Friday of next week. My intent was to protect the equity I have in this call option so it doesn't dwindle into next week. Now the call was out of the money so the equity was all time value however I didn't like the way the market looked therefore I sold the futures and missed taking profit by $.10 today as I had an order to exit the short futures at $268.10.

Bottom line - I am looking for continued weakness in May '09 meal tonight/tomorrow but I think we will see an early low and late high. We are having a tough time closing above $271.00 to get anything going to the upside. Support for May '09 meal should be $268.20, $267.20 and then $265.10. Resistance should be $271.20, $272.10 and then $273.00. I expect early lows and late highs tomorrow.

HOGS - June '09 GLOBEX
Open - $72.05, High - $72.65, Low - $71.70, Close - $72.40 Up $.70

As a review, yesterday I said "I am looking for continued downside tomorrow with pressure more than likely mounting. We closed below my support area of $71.90 today and if we continue to close below it we should test $69.525 in short order. If we test and close below $69.52 then ouch, another leg lower is possible. Support for tomorrow is $71.35 then $69.525 and resistance is $72.425 then $72.62 then today's high of $73.25. I expect a weak day of trade tomorrow with the majority of negativity coming early in the day as the charts look like we could find support later in the session. "

June '09 hogs didn't get to my support number of $71.35 today but it did reach my second resistance point of $72.62 ($72.67 was the high) which I sold against. I added to my short position today as I see this bounce as a gift. My work from 2000 to 2008 shows that June futures decline 67% of the time from March 15th to April 1st on average of $2.83 cwt and the other 33% of the time they increase on average of $3.02 cwt.

Bottom line - with packer margins still in the red I continue to have a negative bias toward the market because today's action didn't tell me much from a chart perspective. We closed back above the $71.90 number I spoke of yesterday so we need to continue to watch this level to give us further direction. Cutout was up $.98 today and it was up $.82 yesterday so we've had back to back days of higher cutout numbers which will be psychologically supportive to the market. I look for early strength in the market based off of tonight's cutout number but I believe we will have early highs and late lows. Support for June '09 should be $72.175, $71.70 then $71.47. Resistance should be $72.675 then $73.25. I am still not friendly hogs at these levels and I have a cycle high being put in tomorrow and then a lower trend into approximately March 27th. Again I'm looking for early highs and late lows tomorrow.

NW_LS500
Des Moines, IA     Wed, Mar 11, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh bone-in loins mostly
steady; butts steady to 1.00 higher; sknd hams 17-20 lbs steady, 20-23 lbs weak,
23-27 lbs not tested; sdls bellies 14-16 lbs 2.00 higher; lean trimmings not
tested. Trading slow, with light to mostly moderate demand and light to
moderate offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :             74.38
Loads TRIM/PROCESS PORK  :               4.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/11        78.4      57.08   73.68   63.71  32.32  97.00 40.07  75.68
Change :                0.98    1.77    0.02   1.33   0.08  0.82   1.10
-----------------------------------------------------------------------

USDA cash reports were delayed today due to packer submission problems so

please use the link below to check for the updated cash prices.


USDA Hog Price Comparison

Hog Comments - 03-10-09 - Price weakness continues in hogs.

2009-03-10T14:19:00.000-05:00

CORN - May '09 Electronic
Open - $3.64 1/2, High - $3.84, Low - $3.64 1/4, Close - $3.75 1/2 Up $.10

I said yesterday "I am looking for May '09 corn to open unchanged to lower tonight based on follow through from the close today. I see support at $3.64, $3.62 1/2 and then $3.58, I see resistance at $3.67 then $3.70. I am expecting early follow through weakness tonight and MAYBE tomorrow morning but I am looking for an early low and a late high tomorrow. We need a close above $3.68 to gain more strength for a run at the upside but for now I believe selling will surface just below today's low."

My first level support point was almost right on today but I was only off on resistance by $.14! I expected to see a small correction before we made a move like we had today but obviously that wasn't the case. The stock market helped get things going this morning because Citibank stated it had a profitable first two months of 2009 which is the best they've had since the third quarter of 2007; Wells Fargo made a similar comment last Friday. This got stocks moving higher in pre-market and then the Government stated they would bring back the "up tick rule" in the stock market which sent the Dow Jones above 300 points higher. They also made a comment that they will review mark to market accounting.

Bottom line - I am still looking for a place to buy May '09 corn against $3.60 put options as the market didn't get to my target levels over the past couple of days. We have now traded substantially above the downtrend line in the May '09 contract and I look for a close above $3.68 for a couple of days before getting extremely excited about a major rally. Support for tomorrow is $3.74 $3.71 3/4, $3.69 and resistance should be $3.81 1/4 and then $3.84. The market created a sell signal at $3.79 1/2 in the May '09 contract today with a protective buy stop at $3.85.

MEAL - May '09 Electronic
Open - $265.00, High - $273.90, Low - $264.40, Close - $271.30 Up $6.30

Reviewing yesterday's comments I said " I am looking for an early low and late high tomorrow with support at $264.50 and $263.10 and resistance to be $267.50 and $270.50. I am still in the camp of soybean meal looking for a bottom therefore I have call options in place to give us upside protection in the event of a rally. I want upside protection at these levels but I want known risk thus the use of options."

I was very close with my first level of support in May '09 meal but like corn I was off on my resistance number but not near as bad as I was in corn. I have been saying I am looking for the market to bottom in here but we have failed to get any type of rally going that is sustainable. Today we closed above a key level of resistance of $270.50 which is the 62% retracement level back to the contract low. A close above this level looks positive but we need more than just one, I would like to see follow through to the upside tomorrow and another close above $270.50 before I get very excited about rally attempts.

Bottom line - I am looking for tonight/tomorrow's trade to open on weaker tone and test support at $269.20 to $268.00 before finding support. As I said above we need to see the market continue to close above $270.50 before I think we can make a bigger move higher. If you don't have upside protection in place I would make sure you visit with someone who can help you with this need. Support for tomorrow is $269.20, $268.00 then $264.40 and resistance is $272.30 and $273.90.

HOGS - June '09 GLOBEX
Open - $73.00, High - $73.25, Low - $71.60, Close - $71.70 Down $1.50

As a review from yesterday I said "I am looking for the June '09 hogs to test $72.37 with an ultimate test of $71.90. If we close below $71.90 for a couple of days then I would expect a test of $71.30 to $69.55 area. I see June '09 trading lower tomorrow in the early stages of the day and possibly finding support later in the session however I think any rally we have tomorrow will be sold by professional traders. I don't like the market here unless we start to see big moves to the upside in the cutout numbers. Support for tomorrow is $72.37 and $71.90 where resistance is at $73.60, $73.77 and then $74.30 although I don't think it is likely we will see the topside of resistance tomorrow. Today looked pretty ugly on the charts (in my opinion)."

Not much has changed from what I said yesterday or late last week, I am not short-term friendly June '09 hogs at these prices until something significant changes with cutout. Packer margins are still in the red and it business principles would suggest you can't slaughter hogs at a loss for an extended period of time, something has to give. Again, my decisions are based on chart action with followed by an awareness of fundamental information so I am more concerned with the way the chart looks than anything.

Bottom line - I am looking for continued downside tomorrow with pressure more than likely mounting. We closed below my support area of $71.90 today and if we continue to close below it we should test $69.525 in short order. If we test and close below $69.52 then ouch, another leg lower is possible. Support for tomorrow is $71.35 then $69.525 and resistance is $72.425 then $72.62 then today's high of $73.25. I expect a weak day of trade tomorrow with the majority of negativity coming early in the day as the charts look like we could find support later in the session.

I had to post these comments prior to the cash and cutout information release by the USDA this afternoon, my apologies. Below are the links to the USDA site to get this information.

Pork Cutout

USDA Hog Price Comparison

Hog Comments - 03-09-09 Hogs slide after opening higher.

2009-03-09T14:00:00.000-05:00

CORN - May '09 Electronic
Open - $3.65 3/4, High - $3.70, Low - $3.64 3/4, Close - $3.65 1/2 Up $.04

Due to time constraints today my comments will be short and sweet but the balance of the week looks good for posting comments. I don't have anything to review from Friday because I didn't have any comments therefore I will start from scratch today. There has been small volume in May '09 corn over the last few sessions which leads me to believe there isn't much behind this little rally we are getting. I am not suggesting you sell everything in sight all I mean is I think we could see another correction lower prior to making new highs above $3.80 1/2.

I exited long futures last week on Wednesday I believe and I am look for a place to re-own futures against my long $3.60 April puts to turn them into calls. I am not a big fan of flat out ownership of corn at this point until I see better indications of a bottom from the chart. We are still using the downtrend line from the January high as resistance. We need to close above that level ($3.68) for a few days for me to get excited about an upside move.

Bottom line - I am looking for May '09 corn to open unchanged to lower tonight based on follow through from the close today. I see support at $3.64, $3.62 1/2 and then $3.58, I see resistance at $3.67 then $3.70. I am expecting early follow through weakness tonight and MAYBE tomorrow morning but I am looking for an early low and a late high tomorrow. We need a close above $3.68 to gain more strength for a run at the upside but for now I believe selling will surface just below today's low.

MEAL - May '09 Electronic
Open - $267.70, High - $270.50, Low - $264.80, Close - $265.00 Down $.30

May '09 meal had a relatively quiet day and closing near unchanged. Looking at the intra-day charts I feel we could see unchanged to lower tonight as the market opens. I believe we will test $264.50 and POSSIBLY $263.10 before finding support. I look for May '09 meal to have an early low and a late high during tomorrow's trade similar to corn.

Bottom line - I am looking for an early low and late high tomorrow with support at $264.50 and $263.10 and resistance to be $267.50 and $270.50. I am still in the camp of soybean meal looking for a bottom therefore I have call options in place to give us upside protection in the event of a rally. I want upside protection at these levels but I want known risk thus the use of options.

HOGS - June '09 GLOBEX
Open - $73.15, High - $74.30, Low - $72.95, Close - $73.20 Down $.525

June '09 hogs moved higher right after the open of trade today. I sold hogs on Wednesday or Thursday of last week around $73.05 for a hedge based on the way the market looks and feels at this point. I am not ruling out the fact that we can't move higher at some point but I think we need a setback first. The packer margin is awfully red so something needs to happen, either cash come down or cutout comes up. So far the cutout isn't doing its part to solve the margin problem. The assumptions I make about packer margins are based on information I have and is not from the packers themselves therefore I can't guarantee its accuracy.

I am looking for continued weakness tomorrow based on how the charts look. The last commentary I had last week said I was looking for hogs to have a downside reversal on Thursday which was on target in the morning but closed higher on the day. I am standing by my comments and continue to believe we should see a setback in the June '09 hogs before going much higher.

Bottom line - I am looking for the June '09 hogs to test $72.37 with an ultimate test of $71.90. If we close below $71.90 for a couple of days then I would expect a test of $71.30 to $69.55 area. I see June '09 trading lower tomorrow in the early stages of the day and possibly finding support later in the session however I think any rally we have tomorrow will be sold by professional traders. I don't like the market here unless we start to see big moves to the upside in the cutout numbers. Support for tomorrow is $72.37 and $71.90 where resistance is at $73.60, $73.77 and then $74.30 although I don't think it is likely we will see the topside of resistance tomorrow. Today looked pretty ugly on the charts (in my opinion).

I had to post these comments prior to the cash and cutout information release by the USDA this afternoon, my apologies. Below are the links to the USDA site to get this information.

Pork Cutout

USDA Hog Price Comparison

Hog Comments - 03-04-09 - Looking for a downside reversal in hogs tomorrow.

2009-03-04T15:39:00.009-06:00

CORN - May '09 Electronic
Open - $3.49, High - $3.65, Low - $3.47, Close - $3.63 1/2 Up $.13
Reviewing what I said yesterday - "I feel like we should continue to try and move higher tomorrow as we got very little of that accomplished today. I see today's high of $3.54 1/4 as a target area for tomorrow and then $3.58 in the May '09 contract. Overall I think we could be mixed tomorrow with the upside resistance areas being targets. Tomorrow's support is $3.48 1/4, $3.47 1/4 then $3.44 1/2. Tomorrow's resistance is $3.54 1/4 and then $3.57 1/4. I look for mixed to better trade tomorrow."

I was off by $.07 cents on the resistance side of the market (upside) and within a 1/4 cent of my mid-range support level from yesterday. I felt as though the market would try a move higher but this one surprised me today. I took some small profits on the long futures I have on against my $3.60 puts today because I see $3.66 1/2 as resistance in the May '09 contract. I am looking to re-establish my long position below the market if I can but I have no problem getting back in the market doesn't respect what the charts say it should do.

Bottom line - I expect an early high tonight with the market possibly testing $3.66 1/2 to $3.67 1/2 and then calling it a day. I have a sell signal SETUP at $3.67 1/2 if we move above this level and then come back down through it. I would have a sell stop at $3.67 with a protective buy stop $.01 above the most recent high. I am looking for an ultimate test of $3.56 at some point but I am not sure we will have enough pressure to get there tonight/tomorrow. We should test support of $3.60 1/2 to $3.59 1/2 and then down to $3.56 which is my target before the market makes any bigger moves up at this point. I am still not bearish longer-term but I'm looking for a correction tomorrow.

MEAL - May '09 Electronic
Open - $263.70, High - $273.00, Low - $262.40, Close - $267.30 Up $2.60
I said yesterday "The market looks like we should have follow through to the upside tomorrow based on the way we traded today. I see support at $262.90, $262.20 and then $260.00 if we get moving to the downside. Resistance should be around $263.90 and then $265.70. One note to point out is if the May contract moves above $265.70 and then comes back down through it will trigger a sell signal at $265.20 on a stop. If the sold at $265.20 then a risk management buy stop order should be placed $1.00 above the most recent high. This is an observation not a recommendation."

Bottom line - I was within range on the support side of the May '09 meal market today but not close on the resistance side as it went through what I thought would stop the market by $7.30! I am looking for market action to be similar to corn, open better and then find early resistance. I expect May '09 corn to test support of $265.00 and then to $260.00 and resistance to be $269.50, $270.30 and then $273.10 which was today's high. I still feel like we are looking for a bottom in this area and I do have my needs covered with $280.00 call options in May '09.

HOGS - April '09 GLOBEX
Open - $61.00, High - $62.80, Low - $60.775, Close - $62.325 Up $1.475
Reviewing yesterday's comments I said "We got a market close back above the $60.45 level which will open the door to a longer-term target of $64.00 provided the April '09 contract continues to close above $60.45. I am looking for mixed markets tomorrow but with a friendly feel, I can see both directions tomorrow. April '09 support is $60.65, 60.32 and resistance is 60.975, $61.32 then up to $64.00 (outside of limit range but is the next resistance level). June '09 support is $71.35, $71.125 and resistance is $72.12, $72.45 then $72.75."

I pretty much wrong across the board on this one today, I got close on the support levels but the market blew through all of my resistance points which is fine by me. I had a short-term change of heart today as I sold the June '09 contract. I had/have a sell signal at $72.75 AND at $73.50 on a stop order and if that order is filled (the $73.50 would be) then the protective risk management buy stop would be around $73.85. I see some things building on the chart that doesn't look that good. The signal I had to buy at $70.60ish that started the rally is the same signal I have on the sell side today/tomorrow.

Bottom line - The cash market was stronger again today but there are not a lot of packers in the market place bidding for hogs and cutout was down so the packers took a double whammy in margin today. I haven't been this aggressive of a seller in a while but things are beginning to line up with charts and fundamentals. I am still not a bear longer-term but for now I want to be short and if I am wrong I will exit my positions and look to sell higher. June '09 support is $72.52, $72.25 and $71.35 which I believe is very possible. June resistance is $73.12, $73.75 and then $74.15 which I think is highly unlikely.

NW_LS500
Des Moines, IA     Wed, Mar 04, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh loins generally steady;
butts firm; sknd hams 20-23 lbs 4.00-5.00 higher, 23-27 lbs 1.00 higher on a
light test; sdls bellies 14-16 lbs steady; lean trimmings unevenly steady.
Trading slow to moderate, with light to moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             75.63
Loads TRIM/PROCESS PORK  :              41.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

          Calculations for a 200 lb Pork Carcass
       53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
        Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/04       116.6      56.26   73.65   61.39  35.17  97.93 39.09  71.30
Change :               -0.66    1.32    1.63  -5.03  -0.50 -2.42   0.01
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Mar 04, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
               :  National   :    Iowa     :   Western   :   Eastern
               :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
  Base Price is the price from which no discounts are subtracted and
  no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.76 hgr   :  2.25 hgr   :  1.88 hgr   :  1.47 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 47.00-62.00 : 47.00-62.00 : 47.00-62.00 : 47.00-61.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.76    :    59.13    :    59.00    :    54.90
--------------------------------------------------------------------------
Head Count      :   31,114    :   16,963    :   21,688    :    9,426
==========================================================================

Hog Comments - 03-03-09 - Hogs find support and rebound.

2009-03-03T14:51:00.000-06:00

CORN - May '09 Electronic
Open - $3.49, High - $3.54 1/4, Low - $3.47 1/4 Close - $3.50 1/2 Up $.00 1/4

As a review of yesterday is said "I think it is safe to say we should see a test of today's low of $3.44 1/2 and then attempt to rally toward $3.50 3/4. Support for tomorrow in the May '09 contract is $3.44 1/2 then small support at $3.37 1/2 and resistance should be $3.50 3/4 then $3.52 1/4. I am looking for some turn around Tuesday action tomorrow."

The May '09 contract made it through the $3.52 1/4 upside resistance level I had penciled in for today and it was .02 3/4 above my support level of $3.44 1/2. I wish I had some magical news or chart formations to talk about today but I really don't. Today was pretty boring when it comes to the market, the Feds have been speaking in Washington D.C. all day and that has the Dow Jones both up and down depending on the comments that are being made. We did have an inside day today meaning today's low and high were both within yesterday's trade range.

Bottom line - I feel like we should continue to try and move higher tomorrow as we got very little of that accomplished today. I see today's high of $3.54 1/4 as a target area for tomorrow and then $3.58 in the May '09 contract. Overall I think we could be mixed tomorrow with the upside resistance areas being targets. Tomorrow's support is $3.48 1/4, $3.47 1/4 then $3.44 1/2. Tomorrow's resistance is $3.54 1/4 and then $3.57 1/4. I look for mixed to better trade tomorrow.

MEAL - May '09 Electronic
Open - $260.50, High - $265.70, Low - $259.90, Close - $264.70 Up $3.90

Yesterday I said "I see tomorrow having an early low and a late high looking for a turnaround Tuesday type action. Support is $259.50 then $255.30 and resistance is $263.90 then $265.20. I am looking for an early low and late high tomorrow but it all depends on how the Dow Jones reacts tomorrow."

My support and resistance points for today were relatively close to the mark, we were within $.40 on support and $.50 on the resistance side. The May '09 meal contract is still below the $265.20 level that would provide a test toward $270.90 if we managed to close above this level for a couple days. .

Bottom line - The market looks like we should have follow through to the upside tomorrow based on the way we traded today. I see support at $262.90, $262.20 and then $260.00 if we get moving to the downside. Resistance should be around $263.90 and then $265.70. One note to point out is if the May contract moves above $265.70 and then comes back down through it will trigger a sell signal at $265.20 on a stop. If the sold at $265.20 then a risk management buy stop order should be placed $1.00 above the most recent high. This is an observation not a recommendation

HOGS - April '09 GLOBEX
Open - $60.00, High - $61.325, Low - $60.00, Close - $60.85 Down $.575

Reviewing yesterday's comments I said "I expect some recovery for the hog sector tomorrow along with the grains with projections of early lows and late highs. April '09 support for tomorrow is $59.825 then $59.55 and if we get bearish then $58.60, resistance is at $60.45 then $61.075-$61.275. June '09 support is $71.175 then $70.825 while resistance should be $71.925-$72.125 then $72.75. I don't think the high end of my resistance levels for either April '09 or June '09 is attainable tomorrow unless we get major rallies in other markets."

We got within $.20 of my first support level in April '09 and $.05 above my resistance level. In June '09 we got within $.175 of my first support level and within $.30 of my last resistance level. There was very little in the way of news today from a fundamental perspective. The market traded technically today as illustrated by my support and resistance points from yesterday.

Bottom line - We got a market close back above the $60.45 level which will open the door to a longer-term target of $64.00 provided the April '09 contract continues to close above $60.45. I am looking for mixed markets tomorrow but with a friendly feel, I can see both directions tomorrow. April '09 support is $60.65, 60.32 and resistance is 60.975, $61.32 then up to $64.00 (outside of limit range but is the next resistance level). June '09 support is $71.35, $71.125 and resistance is $72.12, $72.45 then $72.75.

I have an appointment this afternoon therefore I will not have any USDA information today.

Hog Comments - 03-02-09 - Hogs take a break from the recent rally.

2009-03-02T15:21:00.000-06:00

CORN - May '09 Electronic
Open - $3.57 1/4, High - $3.62 3/4, Low - $3.44 1/2 Close - $3.50 1/4 Down $.08 3/4

May '09 corn did what everything else was doing today, moving lower. I had support last week at $3.59 1/4 where I purchased futures ($3.60 actually) against $3.60 May'09 call options to get further coverage in place after taking some equity out of the market the day before. I have around 25% exposure to the downside that has unknown risk however all of my other positions have a know risk factor.

As I watched the May '09 corn contract sink lower and lower today it did find some support around $3.45 1/2. The market made its big move during the first hour of trade then had $.01 1/2 worth of follow through to the downside during the second hour and the third hour was looking for a retracement of the earlier downside move. It is hard to have a friendly tone to the market now that we have pierced the $3.50 1/2 support level in the May '09 contract. Last Friday's close below $3.63 wasn't the best Weekly close we could've had. A close below $3.63 on a consistent basis would project another test of the contract low of $3.15 3/4 set on 12-05-08.

Bottom line - today's action is piggy backed on the decline of the Dow Jones making its lowest low since 1997 by the help of our friends at AIG needing more taxpayer money. The Dow Jones aside I am looking for an early low tomorrow and firm as we move forward into the day. I think it is safe to say we should see a test of today's low of $3.44 1/2 and then attempt to rally toward $3.50 3/4. Support for tomorrow in the May '09 contract is $3.44 1/2 then small support at $3.37 1/2 and resistance should be $3.50 3/4 then $3.52 1/4. I am looking for some turn around Tuesday action tomorrow.

MEAL - May '09 Electronic
Open - $267.50, High - $269.30, Low - $259.50, Close - $260.80 Down $9.00

May '09 meal wasn't anything special today as it followed the same trade tendencies as the rest of the Ag commodities. I have a cycle low in place on May '09 meal as of last Thursday but that doesn't mean the cycle is that exact low; it makes a projection in the area of the low. Looking at today's trade we see some signs of a possible recovery tomorrow. The troubling part of this cycle low is the market has now closed below $270.70 for three straight days and that would suggest a test of the contract low at $237.00. I have call option positions in place where I know my risk and will continue to use this strategy until I see signs that would suggest otherwise.

Bottom line - I see May meal opening lower tonight on follow through weakness and then finding support and firming from there. Again, similar to corn I believe the Dow Jones is going to have some effect on tonight's open for the Ag sector. I see tomorrow having an early low and a late high looking for a turnaround Tuesday type action. Support is $259.50 then $255.30 and resistance is $263.90 then $265.20. I am looking for an early low and late high tomorrow but it all depends on how the Dow Jones reacts tomorrow.

HOGS - April '09 GLOBEX
Open - $60.925, High - $60.975, Low - $59.825, Close - $60.275 Down $.625

April '09 hogs retraced some of its gains from last week today closing $.625 lower on the day. Morning cash bids were up nicely according to the USDA but with the outside markets in the crapper it was hard to get anything going to the upside. Also some of the cash optimism was factored into last week's trade.

The market action in the April '09 contract was just a pause to make a move higher in the future. We bounced off of the 50% retracement level of Friday's price range ($59.825) and closed above it. With this being said it looks as if the market wants to make another run at Friday's high of $61.075 at some point in the near future. June '09 is also holding above $71.175 which is the 50% retracement level back to the $69.62 low prior to our rally. As long as we hold $71.175 the market is still poised to test the most recent high of $72.75 at some point in the near future.

Bottom line - I am looking for some early weakness tonight/tomorrow and test the $59.82 level in the April '09 and also the $71.175 level in the June '09 contract. Cutout was mildly lower tonight only down $.13 but we sure could have used some positive news in what seems to be a huge bear blanket surrounding the markets today. I expect some recovery for the hog sector tomorrow along with the grains with projections of early lows and late highs. April '09 support for tomorrow is $59.825 then $59.55 and if we get bearish then $58.60, resistance is at $60.45 then $61.075-$61.275. June '09 support is $71.175 then $70.825 while resistance should be $71.925-$72.125 then $72.75. I don't think the high end of my resistance levels for either April '09 or June '09 are attainable tomorrow unless we get major rallies in other markets.

NW_LS500
Des Moines, IA     Mon, Mar 02, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh loins steady to weak;
butts, sknd hams, and sdls bellies steady; lean trimmings firm. Trading slow,
with light to moderate demand and mostly moderate offerings.




-----------------------------------------------------------------
Loads PORK CUTS          :             52.38
Loads TRIM/PROCESS PORK  :               6.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
03/02        58.4      56.22   70.76   60.01  40.12  98.00 40.32  71.26
Change :               -0.13   -0.36    0.26   0.00  -0.16 -0.25    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Mar 02, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.32 hgr   :   .13 hgr   :   .88 hgr   :   .67 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.00-59.00 : 46.00-59.00 : 46.00-59.00 : 46.00-59.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.22    :    55.44    :    56.19    :    52.63
--------------------------------------------------------------------------
Head Count      :   24,537    :   11,776    :   17,344    :    6,489
==========================================================================

Hog Comments - 02-26-09 - Hogs got stuck in the mud today.

2009-02-26T15:40:00.000-06:00

CORN - May '09 Electronic
Open - $3.71 1/4, High - $3.80 1/2, Low - $3.65 3/4 Close - $3.70 1/2 Down $.01 3/4

As a review from yesterday I said "I am looking for a retracement lower tomorrow with a test of the $3.68 1/2 to $3.66 area. The daily chart looks somewhat impressive after today's activity so if we do not retrace tomorrow and close firmer again I think we may be starting a leg higher in the market. I think we will make an early high and late low tonight. Support will be $3.68 1/2 to $3.66 and resistance will be $3.77 3/4 and then $3.80 however I am not confident that we will get that high."

May '09 corn hit both ends of my range from yesterday, the high was $3.80 1/2 just a 1/2 higher than my number and the low was $3.65 3/4 only a 1/4 below my number. I sold out of some long positions at $3.76 which were put on the other day at $3.59 1/2. I am now back down to around 25% of feed corn covered and I look to re-establish my coverage around $3.60 if we can get that low. If May '09 closes above today's high of $3.80 1/2 then I may change my mind but for now I am going to make the market prove itself to me.

Bottom line - I expect the May '09 contract to open slightly higher tonight and find early resistance. I think we have another shot at testing today's low either tonight or tomorrow. Sustained trade below $3.70 tonight/tomorrow will trigger a target of $3.59 1/4. Support will be $3.65 3/4 and then $3.59 1/4 and resistance will be $3.73 to $3.75 and then ultimately $3.80 1/2. I am expecting another day of weak trade tomorrow however I am still not bearish longer-term.

MEAL - May '09 Electronic
Open - $267.40, High - $270.50, Low - $259.70, Close - $263.20 Down $4.20

As a review from yesterday I said "I have a cycle low in place for tomorrow and also a longer-term buy signal at $266.60 on a stop order if the market moves below today's low and turns around and moves higher from there. The protective risk management sell stop would be $1.00 below the most recent low. I am looking for the early low and late high today which didn't happen so I am carrying that thought over into tomorrow. Support will be $265.90 then $265.30 and resistance will be $271.60 to $272.90."

As mentioned above, we will have a longer-term buy signal ON A STOP at $266.60 if and only if the market makes its way back up to these levels. The intraday chart suggests we have a chance to make this signal during tomorrow's trade. The evening trade has the market making another dip lower before we take a stab higher.

Bottom line - I believe support will be at $259.70 with a good chance of touching this level and resistance will be $265.10 to $266.40 but if the aforementioned signal is good then we could see a challenge of today's high of $270.50. I was expecting an early low and late high today which we didn't get but the third time is a charm right? My expectation is for an early low and late high tomorrow (I know if you say it long enough it will happen eventually but that isn't my intent) although the meal market has been challenging me this week. I still own my $280.00 April call options and have the downside open, if the market drops enough I will roll my options down to a lower strike price.

HOGS - April '09 GLOBEX
Open - $59.35, High - $59.50, Low - $58.60, Close - $58.975 Down $.125

Reviewing yesterday's comments I said "cash was weaker again today with a lot of packers bought up into next week. The cutout was up $.41 today and cash was lower again so that means the packers gained more of their profit margin back today. I am expecting follow through on this rally into tomorrow on the coattails of higher product tonight. I think we can see the April '09 contract reach $60.425 tomorrow if the follow through is of the force I think it could be. I look for the hog market to firm as the day moves forward tomorrow. Support will be $58.75 to $58.50 and resistance will be $59.60 to $60.425 of which I think we could touch."

Reviewing my comments I guess I should have gone with my first level of resistance at $59.60 considering the high today was $59.50. I was in range on the support side of the equation but not accurate in thinking we would firm as the day moved forward. I think today was just a corrective/slow down day because it didn't do anything damaging to the charts. We will need to close below $58.05 in the April or $70.52 in the June contract. There are levels of support slightly above the respective numbers but these are my line in the sand values.

Bottom line - I am looking for April to continue lower tonight and make and early low and possibly test $58.35 but the market had a hard time moving lower today. I am still on board with higher hog prices to come and I would like to see us close at $59.00 or higher tomorrow for a continued setup on the weekly chart. Support tomorrow is $58.32 to $58.05 for April and $70.80 to $70.53 in June. Resistance for April '09 is $59.15 to $59.50 and then up to $61.00 although it is unlikely to happen. Resistance for the June '09 contract is $71.60 to $72.00 and then all the way up to $73.50 which is unlikely tomorrow.

NW_LS500
Des Moines, IA     Thu, Feb 26, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh loins generally steady;
butts steady to 1.00 lower; sknd hams 17-23 lbs not tested, 23-27 lbs weak in
a light test; sdls bellies 14-16 lbs steady; lean trimmings not tested. Trading
slow to moderate, with light to moderate demand and mostly moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              86.5
Loads TRIM/PROCESS PORK  :               3.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/26        89.5      56.57   71.97   60.91  40.06  97.15 40.65  71.26
Change :                0.14    1.50    0.72  -0.53   0.44 -0.61    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Feb 26, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .10 lwr   :   .63 hgr   :   .49 hgr   :  1.12 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.50-54.05 : 47.00-54.05 : 47.00-54.05 : 44.50-54.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    52.14    :    52.70    :    52.77    :    51.05
--------------------------------------------------------------------------
Head Count      :   20,873    :   10,336    :   13,206    :    7,667
==========================================================================

Hog Comments - 02-25-09 - Hogs find support and look to rally.

2009-02-25T16:37:00.000-06:00

CORN - May '09 Electronic
Open - $3.63, High - $3.77 3/4, Low - $3.59 1/4 Close - $3.63 Up $.09 1/4

As a review from yesterday I said "Resistance is $3.62 3/4 and then $3.68 1/2 which I think we will touch. Support is $3.61 1/4 to $3.59 1/2, we may touch $3.61 1/4 but assuming no surprises from the President tonight I think the first support level will hold. I believe corn is searching for a bottom and I am taking a more aggressive approach to protecting upside price risk on feed needs. We still need to get back above $3.63 1/4 and close there on a Friday if we want to show further signs of a bottom."

I was 1/4 cent off on the lowest level of support I projected and the market did bounce from those levels. I also had upside targets of $3.68 1/2 that didn't hold and we moved through them by $.09. The close today was better than I thought it would be, we closed above $3.71 3/4 which is the 50% retracement level back to the $3.93 high we made on Feb 9th, 2009. The intraday charts suggest a steady to lower opening for tonight and for tomorrow to be a give back day.

Bottom line - I am looking for a retracement lower tomorrow with a test of the $3.68 1/2 to $3.66 area. The daily chart looks somewhat impressive after today's activity so if we do not retrace tomorrow and close firmer again I think we may be starting a leg higher in the market. I think we will make an early high and late low tonight. Support will be $3.68 1/2 to $3.66 and resistance will be $3.77 3/4 and then $3.80 however I am not confident that we will get that high.

MEAL - May '09 Electronic
Open - $275.10, High - $277.30, Low - $265.90, Close - $267.40 Down $7.60

As a review from yesterday I said "There is one thing I don't like on the hourly chart (very short-term) is if we gap higher tonight and retreat there is a small sell signal at $274.50 on a sell stop with the risk management buy stop above the most recent high. I WILL NOT take this trade tonight because of all the other longer-term indications I get of a potential bottom." Even though it looks as if the signal was right it was voided because it was conditional to the first two hours of trade and we wouldn't have reached the sell stop during the first hours so it was no good.

I am surprised the soybean and meal market failed to get anything going to the upside today and the last hour of trade is really confusing. It looks like the overnight session should be weaker based on my cycle projections but we had an hourly buy signal at $266.80 and if it is good the market should be up right away tonight. I don't like the way we traded today but I am still in the camp of the market looking for a bottom in here.

Bottom line - I have a cycle low in place for tomorrow and also a longer-term buy signal at $266.60 on a stop order if the market moves below today's low and turns around and moves higher from there. The protective risk management sell stop would be $1.00 below the most recent low. I am looking for the early low and late high today which didn't happen so I am carrying that thought over into tomorrow. Support will be $265.90 then $265.30 and resistance will be $271.60 to $272.90.

HOGS - April '09 GLOBEX
Open - $57.60, High - $59.325, Low - $57.025, Close - $59.10 Up $1.40

As a review from yesterday I said "April '09 hogs actually had good price action today if you are looking for signs of a potential reversal in the market. I have a cycle indicator that says yesterday we were near the bottom of the cycle and today's price action confirms that to me BUT I need to see good buying above today's high of $57.95 and a close above this level tomorrow. A close tomorrow above $70.425 in the June '09 contract would also be beneficial for the prospect of a rally in that contract."

It is evident by today's close the April '09 hogs did get some short-covering and buying come in above $57.95 as mentioned yesterday. I myself bought April '09 futures at $58.075 to hedge my $59.00 put options to protect the equity in them and give me time to see if this rally if for real before I exit puts. With today's close as strong as it was I expect a better opening tonight and further follow through to the upside tomorrow with our next target at $59.60 but ultimately $60.425 is where I think we could be headed. If we can reach $60.425 and close above it for a day or two then we can talk prices of $61.275 to $64.00 but let's not count our chickens yet.

Bottom line - cash was weaker again today with a lot of packers bought up into next week. The cutout was up $.41 today and cash was lower again so that means the packers gained more of their profit margin back today. I am expecting follow through on this rally into tomorrow on the coattails of higher product tonight. I think we can see the April '09 contract reach $60.425 tomorrow if the follow through is of the force I think it could be. I look for the hog market to firm as the day moves forward tomorrow. Support will be $58.75 to $58.50 and resistance will be $59.60 to $60.425 of which I think we could touch.

NW_LS500
Des Moines, IA     Wed, Feb 25, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh bone-in loins and butts
generally steady; sknd hams 20-23 lbs steady, 23-27 lbs steady to 2.00 higher;
sdls bellies and lean trimmings not tested. Trading slow to moderate, with
mostly light to moderate demand and mostly moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :            103.88
Loads TRIM/PROCESS PORK  :               2.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/25       105.9      56.43   70.47   60.20  40.59  96.72 41.26  71.26
Change :                0.41   -0.56    0.09   4.19  -1.43  0.60  -0.01
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Feb 25, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .97 lwr   :  1.22 lwr   :  1.13 lwr   :   .73 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.50-54.50 : 46.50-54.39 : 44.50-54.39 : 45.00-54.50
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    52.23    :    51.98    :    52.24    :    52.19
--------------------------------------------------------------------------
Head Count      :   19,432    :    8,112    :   11,565    :    7,717
==========================================================================

Hog Comments: 02-24-09 Are hogs looking for a reversal?

2009-02-24T14:11:00.018-06:00

CORN - May '09 Electronic
Open - $3.59 1/2, High - $3.63 1/4, Low - $3.54, Close - $3.63 Up $.02 1/4

First things first, if you will notice I shifted from March '09 corn to the May '09 contract. I said yesterday I thought we would see some support at $3.48 3/4 and if we violated that for a few hours then we could test yesterday's low of $3.42 but we only got as low as $3.45 1/4 before finding support. I also said I needed to see a close above $3.52 before I got excited about the market; we got that close today at $3.54 1/4.

I am still not super excited but I did add to my long feed position today buying the May '09 futures around $3.59 1/2, this was on 50% of what our needs are. I also have $3.50 May puts in place against my long futures in case I am wrong about the market. I purchased futures and puts instead of a call because if the market rallies like I think it could I can sell my put options and salvage some cost but if I had a call option in place I would have to pay the entire premium amount to keep my upside open.

Bottom line - Again I am switching to commentary about the May '09 contract instead of March. I am going with a firmer bias for tonight and tomorrow for various reasons, 1.) we closed above $3.61 1/4 which now projects $3.68 1/2 as a target and 2.) the stock market made most of its significant rally after the corn market was closed. As mentioned I think we will be firmer tonight/tomorrow unless President Obama says something the market doesn't like in his State of the "Economy" Address this evening. Resistance is $3.62 3/4 and then $3.68 1/2 which I think we will touch. Support is $3.61 1/4 to $3.59 1/2, we may touch $3.61 1/4 but assuming no surprises from the President tonight I think the first support level will hold. I believe corn is searching for a bottom and I am taking a more aggressive approach to protecting upside price risk on feed needs. We still need to get back above $3.63 1/4 and close there on a Friday if we want to show further signs of a bottom.

MEAL - May '09 Electronic
Open - $272.20, High - $275.00, Low - $269.50, Close - $275.00 Up $1.70

As mentioned in corn I am now referring to the May '09 meal contract instead of the March because of pending expiration. As a review from yesterday I said; if we continue to trade above $270.70 we should begin to make our way back higher with our first target at $295.30, $302.30 and ultimately $325.20. Today's close was at $275.00 which once again is above my key area of $270.70. I failed to mention another area of resistance when I gave targets yesterday and its $281.20 basis the May '09 contract.

The $281.20 area is the 50% level between the Dec '08 low and the Jan '09 high so we need trade above this level for a day or two before I feel very comfortable saying $295.30 is our next target. I still feel like soybean meal is trying to bottom this week but like I said yesterday I need confirmation first and I don't have it yet.

Bottom line - With the Dow Jones rallying into its close today I believe it will bring support to the grain markets tonight therefore I look for meal to open higher tonight. There is one thing I don't like on the hourly chart (very short-term) is if we gap higher tonight and retreat there is a small sell signal at $274.50 on a sell stop with the risk management buy stop above the most recent high. I WILL NOT take this trade tonight because of all the other longer-term indications I get of a potential bottom. Resistance for tomorrow is $276.70 and then $281.20 and support will be $272.30 to $271.60. I believe we will have an early low and a late high tomorrow.

HOGS - April '09 GLOBEX
Open - $57.60, High - $57.95, Low - $56.875, Close - $57.70 Down $.525

Flat out called hogs wrong today on support and resistance targets. I mentioned yesterday there was a buy signal on the intra-day charts at $58.05 but I wouldn't take that trade because the daily charts were so lackluster, this was a good thing today. There is really nothing good to talk about on the fundamental side from a short-term perspective, cash remains weak and we can't seem to light a fire under the cutout.

April '09 hogs actually had good price action today if you are looking for signs of a potential reversal in the market. I have a cycle indicator that says yesterday we were near the bottom of the cycle and today's price action confirms that to me BUT I need to see good buying above today's high of $57.95 and a close above this level tomorrow. A close tomorrow above $70.425 in the June '09 contract would also be beneficial for the prospect of a rally in that contract. When I talk about reversals and rallies I am looking at a shorter-term basis and not calling market bottoms because we need much more confirmation than what we have right now. The information I am giving you on the April and June '09 contracts are just a conditional setup right now.

Bottom line - The cutout was down $.17 tonight which is better than yesterday's number of down $.81 but we can't get around the fact that it is still lower. It sounds like most packers are out of the market for buying pigs this week (at the moment) to continue pressuring the cash market looking to increase the demand for product/cutout. Today is confusing because we have a bunch of bearish fundamental news out there but the charts are showing signs of a possible change in direction. I am a technician so I will go with what I objectively see in the charts. I see support for tomorrow at $57.40 and then $57.25 and resistance above the market is $57.95 and if we manage to sustain trade above $57.95 we should trigger some buy stops to cover some short positions AND it is a buy signal on my chart. IF this buy signal is good and starts a rally over the coming week(s) our next upside target would be $60.475. I wouldn't get aggressive with this signal because of the fundamental situation we are in but I want to talk about it so you know it is there. The way I am handling risk of a potential reversal is using puts to protect downside risk. I'm looking for pressure early and then stabilization as the day progresses.

NW_LS500
Des Moines, IA     Tue, Feb 24, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh loins weak to 2.00 lower;
butts 1.00-2.00 lower; sknd hams 17-20 lbs steady, 20-23 lbs steady to 1.00
lower, 23-27 lbs steady to 2.00 higher; sdls bellies steady to 2.00 lower; lean
trimmings steady to 2.00 lower. Trading slow to moderate, with mostly light
demand and moderate to heavy offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :            125.75
Loads TRIM/PROCESS PORK  :              11.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

         Calculations for a 200 lb Pork Carcass
      53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
       Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/24       136.8      56.02   71.03   60.10  36.40  98.15 40.66  71.27
Change :               -0.17   -1.17   -1.68   3.54  -1.63  0.25  -0.49
-----------------------------------------------------------------------

THE USDA AFTERNOON CASH REPORT WAS NOT AVAILABLE AT THE TIME OF THIS POST.

Hog Comments - 02-23-09 - A bunch of nothing in the Ag sector today.

2009-02-23T16:06:00.000-06:00

CORN - March '09 Electronic
Open - $3.50, High - $3.59 3/4, Low - $3.49 1/2, Close - $3.51 3/4 Up $.01 1/2

I said on Friday that I had a buy signal for March '09 corn at $3.46 3/4 and the market needed to close above this level on Monday (today) for the signal to remain in tack. As of right now the signal is still good but the market failed to honor the price action of the overnight trade. I also said we are up against the $3.54 3/4 down trend line that is providing us with resistance and again today it held.

We saw a big drop in the Dow Jones going into the close of its trade today and should provide some pressure on tonight's commodities open. I also said Friday the Dow Jones had buy signal at 7447 if the market could manage to get back to this level which it did not therefore the signal is null and void.

Bottom line - I expect March '09 corn to open mixed to lower tonight testing $3.48 3/4 before finding some support. If the market fails to hold $3.48 3/4 then the next target would be $3.42, our most recent low. As aforementioned the buy signal is still intact but I would like the market to close above the down trend line at $3.52 before I get excited. We made it through my projection points from Friday and I look for tonight/tomorrow to be sideways to lower and will probably take some direction from Wall Street.

MEAL - March '09 Electronic
Open - $269.90, High - $279.90, Low - $268.60, Close - $276.30 Up $6.30

March '09 meal was trading firmer most of the day with very little downside pressure. The March '09 contract touched and went through my targets from Friday of $272.60 to $273.60 and I said I wouldn't hold my breath for $277.10 but we traded above it for an ultimate high of $279.90 and closed just below the resistance level.

I am moving to May '09 meal for commentary instead of the March contract due to its pending expiration. When I look at the May '09 meal contract I begin to look for a bottom. Today we got back above $270.70 which is the 62% retracement level back to our low on Dec 5th 2008. If we continue to trade above $270.70 we should begin to make our way back higher with our first target at $295.30, $302.30 and ultimately $325.20. I am not making this projection yet because my thoughts are conditional and I need confirmation first.

Bottom line - I look for support in the May '09 meal at $272.20 and resistance to be $276.70. It looks like the meal market wants to make its bottom this week but like I said I need confirmation first. I do like the setup we have so if you don't have meal covered or enough covered now is the time to purchase some coverage via a known risk strategy leaving your downside open.

HOGS - April '09 GLOBEX
Open - $58.125, High - $58.65, Low - $57.95, Close - $58.225 Up $.275

I said last Friday I thought we could test $59.05 and possibly $59.45 but we didn't get very close to these numbers today. The prospects looked good when we opened but then settle down as we began trading for a few minutes. We tested Friday's low today and got within $.05 of it and held which works for me. The April '09 contract was very lackluster today and didn't give me any real direction other than a possible pause before making another stab lower.

On the hourly chart I see an intra-day buy signal at $58.05 with a risk management sell stop at $57.65. I don't know as though I would make this trade because I didn't see anything on the daily chart that gives me great reason to do so. I do see the cycle coming to a point where we could now see better trade for the remainder of the week but I like to focus more on price action and like I said it really didn't tell me much today.

Bottom line - I look for April '09 hogs to trade better this evening and mixed tomorrow with a potential test of $59.45 as I mentioned last Friday. Cutout was down $.81 today and cash was considerably lower again today. Packers are continuing to regain profit margin on a per pig basis with the cash market moving lower at a faster pace than cutout. I look for support to be $57.90 tomorrow and if we break that level then we open ourselves up to another leg lower. From a trading perspective I can see a bounce tomorrow but I still see nothing on the daily chart to get me excited about the prospect of a big rally.

NW_LS500
Des Moines, IA     Mon, Feb 23, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh loins 2.00-3.00 lower;
butts steady to 2.00 lower; sknd hams 17-23 lbs firm, 23-27 lbs steady; sdls
bellies 14-16 lbs steady to 2.00 lower; lean trimmings steady. Trading slow,
with mostly light demand and moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              56.0
Loads TRIM/PROCESS PORK  :              16.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/23        72.0      56.19   72.19   61.78  32.86  99.78 40.41  71.76
Change :               -0.81   -0.63   -0.94  -3.02  -0.06 -0.62  -0.50
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Feb 23, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  2.42 lwr   :  3.07 lwr   :  2.71 lwr   :  1.68 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.00-57.91 : 47.00-57.91 : 47.00-57.91 : 46.00-56.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    54.49    :    54.56    :    54.98    :    53.95
--------------------------------------------------------------------------
Head Count      :   20,892    :    7,104    :   10,973    :    9,919
==========================================================================

Hog Comments - 02-20-09 - Hogs make a new contract low.

2009-02-20T15:26:00.000-06:00

CORN - March '09 Electronic
Open - $3.53 1/4, High - $3.54 3/4, Low - $3.42, Close - $3.50 1/4 Down $.03

All I have to say today is Dow Jones. The Dow Jones tested its November 2008 low of 7449.38 yesterday and made a new low of 7447.55 but managed to close at 7465.95 a few points above the November low. Today was a different story; the Dow tested this level again and moved below this level with no particular concern. We made a new low of 7249.47 which is still above the ever so important October 2002 low of 7197.49. I have a buy signal (this isn't a recommendation) on the Dow Jones index at 7447 if we can get to this level either today or Monday. If I were actually making the trade it would be on a buy stop with a risk management sell stop at 7220.

The Ag commodities markets in general took their lead from the Dow Jones today as everything was weak across the board. March '09 corn made its lows early in the day trading all the way down to $3.42 before coming back some as we moved into the closing minutes of trade. There was a buy signal (not textbook) on the daily chart at $3.46 3/4. March '09 corn will need to stay above $3.46 3/4 on Monday for this signal to be good but the actual risk management sell stop would be at $3.41.

Bottom line - I spoke of the Dow Jones in my comments above but I was writing while the corn market was still open. The Dow bounced off of its low and started a rally as the grain market was closing. I expect March '09 corn to trade higher on Monday with an upside target of $3.56 1/4. We should see buy stops triggered above today's high of $3.54 3/4. We have been butting up against the down trend-line recently and that resistance level is $3.54 3/4 for Monday.

MEAL - March '09 Electronic
Open - $277.40, High - $277.90, Low - $268.00, Close - $270.00 Down $6.50

$269.80 is a 62% retracement back to the low of $235.00 and today was our first test of this level. March '09 meal barely closed above the retracement level but it did close above it. The March '09 contract seems as though it wants to take a small breather here for the moment. I don't expect any major rallies but I do look for a correction up to the $272.60 to $273.60 area with a possible test of $277.10.

I exited my long $290.00 March '09 puts today (because of expiration) and rolled down my long $320.00 April '09 call to an April $280.00 call for $6.50. I also exited a short $350.00 May '09 call option I sold against my original long $320.00 April '09 call option. I sold the call for $10.00 and bought it back for $1.00 so we had a profit of $9.00 to offset some of the cost of my original long $320.00 April '09 position. The reason I sold the May call to help pay for the April call is I wanted upside coverage after I exited my long futures positions but I didn't want the exposure of a futures position. I then put this call spread on ($320 April vs. $350 May) for a net cost of $5.50. I also rolled the option down from $320.00 to $280.00 as mentioned above for $6.50 so I increased the cost of my $280.00 call option to $12.00 but I had a profit in our $290.00 March '09 put of $12.50 to cover my cost and move my ceiling down $40.00/ton.

Bottom line - As I said above I expect the market to be firmer come Sunday night and Monday. I look for the $272.60 to $273.60 area to be tested with a possible test of $277.10 although I will not hold my breath for $277.10.

HOGS - April '09 GLOBEX
Open - $60.70, High - $61.00, Low - $57.90, Close - $58.20 Down $2.375

April '09 hogs have taken a nosedive since my last posting. I said in my last posting the odds of an April '09 market bottom were increasing daily but I wasn't going to make that bold of a prediction to say the market had bottomed. The market completely shrugged off last week's performance and took back all of the gains and then some.

I didn't like the fact that we challenged our contract low yesterday and then made new lows today. I purchased some April '09 $59.00 put options for the time being because we violated our contract low. I did this around the open of today's trade and I will hold these puts until I see signs of market improvement.

Bottom line - I see the hog market making an early low on Monday and then firming as the day moves forward. The cash was significantly lower today based on reduced kills but the cutout was only down $.22 so the packers regained some of their packing margin. It is possible to see a test of $59.05 and then $59.45 on Monday.

NW_LS500
Des Moines, IA     Fri, Feb 20, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Thursday's Close:       Fresh bone-in loins not tested;
butts 2.00-3.00 lower; sknd hams 20-23 lbs steady to firm, 23-27 lbs steady;
sdls bellies 14-16 lbs steady; lean trimmings 2.00 lower. Trading slow, with
light to moderate demand and mostly moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              43.0
Loads TRIM/PROCESS PORK  :              10.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/20        53.0      57.00   72.83   62.72  35.89  99.84 41.03  72.26
Change :               -0.22    0.76   -1.03  -5.17   0.39  1.00    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Fri, Feb 20, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  2.23 lwr   :  3.02 lwr   :  2.93 lwr   :   .18 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 46.50-62.90 : 46.50-62.90 : 46.50-62.90 : 47.50-57.50
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    56.61    :    57.14    :    57.42    :    55.63
--------------------------------------------------------------------------
Head Count      :   23,888    :    9,076    :   13,302    :   10,386
==========================================================================

Hog Comments - 02-11-09 - Pork cutout higher for third day. Is it a trend?

2009-02-11T14:11:00.015-06:00

IF YOU HAVE ANY SUGGESTIONS TO IMPROVE THIS COMMENTARY PLEASE EMAIL
ME AT jknutson@hurleyandassociates.com.

Today's post will probably be the last until Thursday of next week as I will be out of the office
and unable to provide quality commentary.  Please check in for updates as I may have a chance
to post.

CORN - March '09 Electronic
Open - $3.73 1/4, High - $3.76 1/2, Low - $3.68, Close - $3.68 1/2 Down $.08 1/4
In review of yesterday's comments I said in my bottom line section "I expect a slightly higher open tonight with almost immediate resistance and then we should sell off and test $3.74 but I ultimately think we will touch $3.68 again either tonight or tomorrow." I was wrong about the slightly higher open as it was lower by $.03 1/2 but I was accurate saying we should ultimately test $3.68; it was our low for today.

The 60 minute intra-day chart has an interesting setup happening. The market tested the $3.68 low twice and has thus far provided support. If the market gaps (opens) below $3.68 tonight I will have two buy signals on the hourly chart, 1.) if the market gaps lower there is a buy signal at $3.68 1/2 STOP, 2.) if the market opens above $3.68 and then makes new lows below $3.68 only to turn and trade higher than $3.68 we would also have a signal to buy at $3.68 1/2 on a STOP. Again, these are conditional buy signals meaning things still need to take place for them to be good. I am pointing this out as what I see on the chart, it isn't a recommendation because like have said before I can change my mind before I get a chance to inform you!

I re-entered the same orders I had in yesterday to buy another 1/3 of my needs at $3.65 and the remaining 1/3 at $3.63. I may change my approach tonight if the market gaps lower or makes new lows below $3.68 and then reverses to move higher. I will be watching this closely tonight.

Bottom line - I expect March '09 corn to open steady to lower and move lower initially before finding support around $3.66 or so. I expect the market to make new lows below $3.68 and then reverse and move higher. I am expecting an early low and a late high tomorrow with a test of $3.72 1/4 and then $3.73 1/4.

MEAL - March '09 Electronic
Open - $310.70, High - $312.20, Low - $306.00, Close - $305.70 Down $6.40??
If you notice above I have the close at $305.70 and the low at $306.00 which obviously can't be but that is what it is telling me so something is wrong there. As a review from yesterday I said the following " I still think we need another test of the $307.80 to $305.30 area once again which could happen either tonight or tomorrow." As you can see we fell well within that range today with our low being either $306.00 or $305.70.

Bottom line - I expect the March '09 meal to be lower tonight initially and although I don't think we have enough momentum to get there, there is a gap that should be filled at $302.70 at sometime in the future. I think tomorrow will bring an early low and a late high more so on the coattails of corn than anything but this is what I see. If we do make highs later in the day I would say $309.00 to $310.00 will provide resistance.

HOGS - April '09 GLOBEX
Open - $62.20, High - $62.625, Low - $61.925, Close - $62.275 Down $.025
As a review from yesterday I said "I look for the market to rally again tomorrow and challenge today's high of $62.75 and then the $63.25 area shortly thereafter." As you can see I was off by $.125 on the low end of my projections and $.625 off on the high side. I truly thought we would have a larger trade range today than we did; it was only $.725/cwt. This isn't all bad because we stayed within yesterday's range and that works for me. It doesn't negate anything that I have been watching from a bullish perspective.

As I look at the chart it is still throwing me a curve ball (VERY short-term) because my cycle still has us moving lower for a few more hours of trade. I look at the chart and the pattern and it is saying something different, continuation of direction or higher from here. I am sticking to my thoughts of yesterday's high of $62.75 being challenged and also a test of $63.25. If we manage to close above $63.25, particularly on a Friday then we open the doors to $65.75 and $67.15 as I mentioned yesterday. If you want to validate these comment and question my sense of bullishness please refer to my comments from last Thursday, February 5th, 2009, click here.

Bottom line - The cash and cutout were both up today and for cutout that makes three days in a row! The cutout feels real because we were up approximately $.95 on Monday, up $.06 yesterday and up $.86 today and normally if a decent move higher is a joke it seems to be adjusted the next day or two. With the cash and cutout markets finally coming around to some degree it just gives more reason to believe we could be in the midst of an April '09 market bottom. I am not making a bold prediction of an April '09 bottom but the odds are increasing daily. It is too early to tell just yet if we have found our bottom. I expect early lows and late highs tomorrow.

NW_LS500
Des Moines, IA     Wed, Feb 11, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh bone-in loins and butts
firm; sknd hams 17-20 lbs steady, 20-27 lbs unevenly steady; sdls bellies steady;
lean trimmings firm on a light test. Trading very slow, with light to moderate
demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             60.25
Loads TRIM/PROCESS PORK  :               7.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

        Calculations for a 200 lb Pork Carcass
     53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
      Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/11        67.3      58.67   77.30   63.41  37.94 100.47 41.70  72.34
Change :                0.86    0.90    0.81   0.23  -0.74  2.25  -0.03
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Feb 11, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
             :  National   :    Iowa     :   Western   :   Eastern
             :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
Base Price is the price from which no discounts are subtracted and
no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.82 hgr   :  1.81 hgr   :  1.93 hgr   :  2.36 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 43.00-62.16 : 45.00-62.16 : 43.00-62.16 : 43.50-60.50
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.06    :    58.86    :    58.94    :    53.12
--------------------------------------------------------------------------
Head Count      :   32,753    :   17,616    :   22,197    :    8,101
==========================================================================

Hog Comments - 02-10-09 - Hog wild day in the pig market!

2009-02-10T13:26:00.103-06:00

IF YOU HAVE ANY SUGGESTIONS TO IMPROVE THIS COMMENTARY PLEASE EMAIL ME AT jknutson@hurleyandassociates.com.

CORN - March '09 Electronic
Open - $3.74 1/2, High - $3.80, Low - $3.68, Close - $3.76 3/4 Down $.00 3/4
As a review from yesterday I said I thought the $3.69 to $3.66 would be a target area of mine for the very short-term. The market low today was $3.68 so we have met that objective thus far. I had orders in to buy futures against my long $3.60 puts today and I only filled 1/3 of my position at $3.69 and my orders at $3.65 and $3.63 were unfilled.

I think the market will have some follow through and open up slightly this evening but find resistance rather early in the session. I think the market will continue to retreat back toward $3.74 and ultimately the $3.68 level which was today's low. I think we still have some downside potential even with the rally that we had on the close today. The funds were net sellers today but not in any major fashion.

Bottom line - I expect a slightly higher open tonight with almost immediate resistance and then we should sell off and test $3.74 but I ultimately think we will touch $3.68 again either tonight or tomorrow. The Senate passed the stimulus package today and guess what the Dow Jones has done since then; it has moved lower and is now trading down around 380 points as I write this. With this being said I think we should see some spillover weakness from Wall Street tonight.

MEAL - March '09 Electronic
Open - $313.40, High - $316.20, Low - $307.10, Close - $312.10 Down $1.70
March '09 meal tested the area I talked about yesterday, I said a believed we would test $310.50 with an ultimate test of the $307.80 to $305.30 area. The March '09 low today was $307.10 which met my target objective in the short-term. I still think we need another test of the $307.80 to $305.30 area once again which could happen either tonight or tomorrow. The daily chart still doesn't look that great from a bullish perspective and I still have my call spread in place as well as my long $290.00 March '09 puts to buy futures against if we break far enough.

Bottom line - As I mentioned above I think we will be weaker tonight and even tomorrow early in the session. The market still doesn't feel great from a bullish perspective and therefore I don't want to have aggressive positions in place with the market looking like it does. I will continue to have some type of coverage in place in case I'm wrong because it is no secret that I have been before!

HOGS - April '09 GLOBEX
Open - $60.575, High - $62.75, Low - $60.075, Close - $62.30 Up $2.225
April '09 hogs had a great day with the market rallying $2.225/cwt today and keeping my buy signal from Friday intact. I was weary of the strength of the signal with yesterday's action but we didn't take out the previous low of $59.80 which is the risk management stop area. The market still looks good to me from an intra-day perspective and I believe we will continue to move higher tomorrow.

With today's move I am feeling better about my buy signal at $60.65 that I talked about for Friday. If this signal is good, which after today feels much better, we should continue to move higher from here. This signal is common at market tops and bottoms in the past and this could be a bottom too but we need to see more confirmation from a weekly perspective to make that call.

Bottom line - I am still not hedged and have been waiting for a long time but I don't want to get stuck in front of a big rally from low market levels. Being we closed above $61.92 I look for the market to test $63.25 and if we can get above this level then we should see some GOOD short-covering in the market place and then get up to the $65.75 to the $67.15 area. I don't expect a test of these levels until we close above $63.25 for a few days first. I look for the market to rally again tomorrow and challenge today's high of $62.75 and then the $63.25 area shortly thereafter.

NW_LS500
Des Moines, IA     Tue, Feb 10, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh 1/4 trim loins weak;
butts 1.00-2.00 higher; sknd hams 20-23 lbs mostly 2.00 higher, 23-27 lbs
mostly 2.00 lower; sdls bellies steady; lean trimmings steady to mostly 2.00
lower.  Trading moderated, with light to moderate demand and moderate to heavy
offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :            131.80
Loads TRIM/PROCESS PORK  :              23.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/10       154.8      57.81   76.41   62.60  37.71 101.21 39.45  72.36
Change :                0.06    0.06    2.82  -0.41  -0.16 -0.91  -0.02
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Feb 10, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.44 hgr   :  2.05 hgr   :  2.01 hgr   :   .97 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.00-58.78 : 45.00-58.78 : 45.00-58.78 : 44.00-55.55
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.22    :    57.15    :    57.08    :    50.92
--------------------------------------------------------------------------
Head Count      :   26,895    :   13,993    :   18,794    :    8,101
==========================================================================

Hog Comments - 02-09-09 - Pork cutout gains some ground.

2009-02-09T16:27:00.055-06:00

CORN - March '09 Electronic
Open - $3.75, High - $3.83, Low - $3.72 1/2, Close - $3.77 1/2 Up $.00 1/4

The market got within a penny of my downside and upside targets for Friday's trade. I exited most of my long futures positions on Friday going into the weekend because it felt like the market had run its course for the time being. I got out near the open so I didn't get out on the high like I would have liked to but we were able to bank some equity. I had orders in to buy March corn at $3.69 today but we didn't get that low. I put that order in as a just in case order. I still have my $3.60 put options in place that will cover my downside if I do get long futures again prior to the report tomorrow.

I have a bull put spread in place for some compensation if the market does rally but I don't have it on a large portion of my needs. It is there so we take advantage of something if the report comes in friendly tomorrow. As for me I expect the market to have early highs and late lows tomorrow.

Bottom line - if we breach the support level of $3.76 1/2 tonight/tomorrow then I see us challenging today's low (actually Sunday nights low) of $3.72 1/2. $3.69 1/4 is a target area for me before we find good support and below that is $3.66. I think March '09 corn wants to rally but first I think we need a small correction to last week's movement. $3.69-$3.66 is a very short-term target area for me but I still look for the market to move higher over time. I don't have an aggressive long position in place at this time but I will change my mind in a heartbeat if the market tells me to. Keep your feed coverage in place.

MEAL - March '09 Electronic
Open - $316.30, High - $319.40, Low - $310.50, Close - $313.80 Down $3.50

As I mentioned in my corn comments, I exited my meal positions on Friday as well having an average of just below our closing price today. I did buy a call spread for meal coverage today to get through the report tomorrow but if I don't need the coverage after the report tomorrow I will exit the call spread and look to buy futures on a price decline against the put options we own at $290.00 in the March '09 contract.

Bottom line - It feels like we will see a test of today's low of $310.50 at some point either tonight or tomorrow. I do see a buy signal in the 60 min chart if and only if we make new lows below $310.50 and then come right back up through those levels. The buy would be a $311.00 buy stop with a risk management protective stop below the most recent low. I think a test of $307.80 to $305.30 is in the cards in the near future.

HOGS - April '09 GLOBEX
Open - $60.20, High - $60.725, Low - $59.975, Close - $60.075 Down $.325

I said last Thursday there was a big buy signal setting up for Friday at $60.40 and if we went through this level we could see some fireworks. Friday morning looked like the signal should be good to go but then we just ran out of steam and did pretty much nothing all day long. The same went for today, we really didn't do much other than have around a $.75 rang.

The signal is still good but if it was going to do what I described on Thursday we should have closed much higher than we did on Friday. As long as we don't trade below Thursday's low of $59.80 the signal is still good. The cutout having been feared by most over recent weeks threw us a surprise by moving higher by $.92 today. This should bring a positive tone to the market tomorrow because the cash market was lower today as well; this all means the packer margin has improved today.

Bottom line - The market is currently up $.575 in the overnight because of the good cutout number and if we can sustain trade over $60.55 then I think we have a reasonable shot at Thursday's high of $61.12. I still look for the April '09 resistance this week to be around $61.42 to $61.80. I expect better trade tomorrow and the $59.80 low to continue to hold support.

NW_LS500
Des Moines, IA     Mon, Feb 09, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh 1/4" trim loins steady;
butts 2.00-4.00 higher; sknd hams steady to weak; sdls bellies not established;
lean trimmings unevenly steady.  Trading slow to moderate, with light to
moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             46.10
Loads TRIM/PROCESS PORK  :              24.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/09        70.1      57.75   76.35   59.78  38.12 101.37 40.36  72.38
Change :                0.92    3.71    1.82  -2.58   0.48  0.02   0.07
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Feb 09, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .77 lwr   :   .87 lwr   :   .74 lwr   :   .96 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 42.50-56.75 : 45.00-56.75 : 42.50-56.75 : 43.00-55.41
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    53.45    :    54.56    :    54.69    :    51.89
--------------------------------------------------------------------------
Head Count      :   24,218    :    9,284    :   13,415    :   10,758
==========================================================================

Hog Comments - 02-05-09 - Are hogs setting up for another Friday rally?

2009-02-05T14:39:00.118-06:00

CORN - March '09 Electronic
Open - $3.58, High - $3.72 1/4, Low - $3.56 1/2, Close - $3.71 1/4 Up $.13

March '09 corn opened slightly weaker last night, tested the $3.56 area like I thought it would and bounced from there. We got off to a slower start this morning but it didn't take long for the buyers to kick in today. There was good volume in today's upward move of the market compared to the last few days were down.

I didn't buy corn today because I am already long futures against $3.60 puts equaling a synthetic call option. I also have some short $3.80 May '09 puts and long $3.50 April '09 puts for (reverse call spread) some additional coverage to the upside because I didn't want to be flat long futures with my risk unknown. It looks like the market wants to call this a bottom and move higher from here. We closed below $3.59 yesterday but like I said I wanted to see it close below that level for two days before I changed my mind about market direction.

Bottom line - I expect March '09 corn to open slightly lower tonight and move lower initially to find some support before making another run higher. Ultimately I think we will see additional buying above today's high of $3.72 1/4 tonight or tomorrow. $3.69 is a support area I think we could test tonight before we get the market trading higher again. I will again go with better trade tonight and tomorrow with an ultimate objective of $3.81 1/4 to $3.87 1/4. I think $3.81 1/4 is possible for tomorrow but $3.87 1/4 is stretching it.

MEAL - March '09 Electronic
Open - $299.90, High - $311.00, Low - $298.70, Close - $308.00 Up $7.50

As I said yesterday I had conflicting information, I have a cycle indicator suggesting we can still move lower but the price action suggested the market's recent slide was slowing. We moved higher as expected today and we also closed above the $305.00 level I have been talking about. Now that we have closed above $305.00 I am looking for the next close to be above $309.00. I we can sustain trade and close above $309.00 for a couple of days (Friday especially) I will then project a challenge of the $326.00 high from January 23rd, 2009.

Bottom line - I am not a huge fan of the way the March '09 contract closed today because it broke $3.00 in the last hour of trade. I expect the March '09 contract to open slightly lower tonight and possibly test $305.80 and find some support. I still think we have more upside to go tomorrow with new buying above today's high of $311.00.

HOGS - April '09 GLOBEX
Open - $60.75, High - $60.875, Low - $59.80, Close - $60.25 Down $.625

I said yesterday I expected an early low and a late high today and we did get that with the day session low being set in the first hour and the high was matched in the 2nd, 3rd and 4th hour of trade. We closed the day right at the old contract low of $60.25 and if we have two consecutive closes below this level it will not look good for the April '09 contract. I feel like the big boys are playing games with the market to make us think one thing so they can do another.

That said I have a big buy signal at $60.65 on a BUY STOP ONLY. This signal is only good if the market rallies back up through this level. If the buy stop is touched I would have a risk management stop $.25 below the most recent low. IF this signal is good it is one that will send this market screaming higher. This signal plays right into my little theory that the big guns are playing games. I would expect massive short-covering if this signal is good. If you have noticed I have used the word if several times in the last sentence so please don't bet the farm on a possibility. I am stating what I see in the charts and what I talk about should not be taken as recommendations because like always I can change my mind and position hours before you even know about it. Please work with someone you trust and do what is right for your operation.

Bottom line - I am looking for tomorrow's low to be during the first hour of trade if not the open. I think we will have better/higher trade all day tomorrow unless we get a beat down in the cash market then all bets are off. If we stay constant I expect better trade tomorrow with a possible test of $61.20 to $61.55 and if this signal is good I wouldn't be surprised to see a limit move higher. Limit is not my projection tomorrow but I throw it in there because of the capabilities of this signal, it is one of the most powerful signals a chart can have at either a top or bottom. Again, stay objective in your decisions and don't get caught up in the hype of market potential in my comments.

NW_LS500
Des Moines, IA     Thu, Feb 05, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh 1/4" trim loins
not established; boston butts steady to 1.00 higher;, sknd hams 17-20 lbs
steady, 23-27 lbs steady to 1.00 higher; sdls bellies 14-16 lbs steady;
and lean trimmings not tested. Trading slow, with light demand and mostly
moderate offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :              71.0
Loads TRIM/PROCESS PORK  :
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/05        71.0      57.14   74.66   58.23  40.38 101.13 39.34  72.31
Change :               -0.02   -1.41   -0.43   0.01  -0.51  1.63    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Feb 05, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.30 lwr   :  1.55 lwr   :  1.53 lwr   :   .57 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.00-58.45 : 44.00-58.45 : 44.00-58.45 : 44.00-56.08
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    54.55    :    55.52    :    55.75    :    52.70
--------------------------------------------------------------------------
Head Count      :   24,971    :   11,311    :   15,212    :    9,295
==========================================================================

Hog Comments - 02-04-09 - Back on the hog roller coaster.

2009-02-04T13:00:00.093-06:00

CORN - March '09 Electronic
Open - $3.61 1/4, High - $3.69 1/4, Low - $3.55 3/4, Close - $3.58 1/4 Down $.03 1/4

I didn't have much of a commentary yesterday because of my schedule but I did write enough to say I expected early highs and late lows today and got the exact opposite. The market came out of the starting gate with enthusiasm but it was too much for its own good. I also talked about the $3.59 1/2 area and how we failed to close below this number yesterday which would be supportive to the market.

March '09 corn played games most of the day as we traded .03-.05 lower and then we rallied to unchanged before selling off again around 12:45 p.m. CST and making new lows. The trade was looking for sell stop orders below yesterday's low of $3.56 but failed to find many as we only made a new low by 1/4 of a cent. I feel like a lone ranger out here but I am not bearish the market yet, I am viewing this as an opportunity to catch up on feed need coverage via known risk strategies i.e. options. If we close below $3.59 for two consecutive days then I may change my mind and adjust my positions but for now I need the market to prove me wrong.

Bottom line - I look for March '09 to open slightly weaker tonight but then find some support around the $3.56 area and bounce from there. I will be looking for a test of $3.62 1/2 to $3.64 for resistance tomorrow. I like the fact the market rallied near the closing bell in today's day session which makes me think the bottom feeders are searching for a deal. I expect better trade tomorrow.

MEAL - March '09 Electronic
Open - $301.70, High - $306.50, Low - $297.00, Close - $300.50 Down $1.30

March '09 meal met my upside target for today of $305.50 and actually got as high as $306.50 for the day's high. Like I said yesterday I need to see March '09 meal close above $305.00 for me to get excited about the market moving higher. I have conflicting indicators, my cycle indicator projects a downward turn while I see signs on the charts that we may be slowing down.

Bottom line - I am looking for meal to have a better trading day tomorrow because we rallied off of our session lows going into the market close. Today was a relatively low volume day for corn, soybeans and meal so we have to take that into consideration. I am looking for a test of $301.80 to $302.90 for tonight/tomorrow. Make sure you have some type of meal price protection in place via options if you can.

HOGS - April '09 GLOBEX
Open - $62.425, High - $62.625, Low - $60.60, Close - $60.875 Down $1.275

April '09 futures didn't respond exactly the way I thought it would today. We saw weaker cash markets early this morning and that allowed the market to stub its toe a bit. I said yesterday I thought we would see buy stops above yesterday's high of $62.52 but we didn't get that high during the day trading session.

The aforementioned morning cash reports were lower spooking the market causing a sell off and it had very little interest in price recovery after that. We did see a small pop in the market after the noon reports were released but we couldn't get any follow through to the upside. I said yesterday that I like the hog market more and more each day and that is still true but the longer we trade within the $63.25 to $60.25 price range the larger the break out will be. The question is which direction is the break out going to be, up or down?

Bottom line - I am looking for the April '09 contract to be steady to weaker in the overnight trade until we see some volume from the day session tomorrow. I expect support to be at $60.60 and then down to $60.25, we do not want to close below $60.25 if we can help it. Because we didn't get our early low and late high scenario today I am expecting it tomorrow. Afternoon cash

NW_LS500
Des Moines, IA     Wed, Feb 04, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh loins generally steady;
butts steady to 1.00 lower; sknd hams 17-23 lbs 3.00-5.00 lower, 23-27 lbs
steady to 1.00 higher; sdls bellies steady; lean trimmings firm. Trading slow
to moderate, with light to moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             103.5
Loads TRIM/PROCESS PORK  :              11.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/04       114.5      57.09   76.07   58.66  40.37 101.64 37.45  72.31
Change :                0.09    0.44   -1.52   3.83   0.08 -1.18    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Feb 04, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.52 lwr   :  1.65 lwr   :  1.70 lwr   :  1.08 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 42.50-60.14 : 46.00-60.14 : 44.00-60.14 : 42.50-56.76
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.72    :    57.19    :    57.40    :    53.27
--------------------------------------------------------------------------
Head Count      :   24,429    :   11,044    :   14,279    :    9,970
==========================================================================

Hog Comments - 02-03-09 - Hogs fake a selloff and rally into the close!

2009-02-03T20:58:00.041-06:00

CORN

This is going to be short and sweet tonight so here it goes. Corn did not close below the $3.59 1/2 area I have been talking about it. I said yesterday that I didn't think we would have a close below that level and the market gods almost made an example out of me today but they didn't.

Bottom line - I am looking for better trade tomorrow, March '09 touched my resistance level of $3.72 1/4 exactly today this also was the high. I think we will have an early low and a late high tomorrow. I am continually adding to my long call position as I bought more today.

MEAL

I bought more meal today to get back up to a full position in the March '09 contract. I was able to get my purchases done at $300.60 on average and this is against my $290.00 puts so I still have the downside open if I am wrong.

Bottom line - I expect a test of $305.50 tomorrow which was today's high. The March '09 contract needs to close above $305.00 again soon for me to be confident we are going to make a move higher. I have my finger on the trigger if the market feels heavy because my cycle indicator still points lower but there are other signs we could be moving higher for the time being. I will continue to monitor this position closely.

HOGS

April '09 hogs set out to make me look like an idiot again today but then ended up validating my opinion from yesterday of early lows and late highs. The market sold off hard early in the session being down over $1.00/cwt at one point and then rallied into the closing hours of the session.

Bottom line - I expect buy stops above today's high of $62.52 and from there we could see some acceleration to the upside. I am looking for an early low again tomorrow and a late high because I really liked today's action. We challenged Friday's low and even made a new one and came charging right back, I LIKE IT A LOT. I don't want to count my chickens before they are hatched but I like the hog market more and more each day.

NW_LS500
Des Moines, IA     Tue, Feb 03, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh loins generally steady;
butts steady; sknd hams 17-23 lbs not tested, 23-27 lbs steady; sdls bellies and
lean trimmings steady. Trading slow to moderate, with light to moderate demand
and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             91.75
Loads TRIM/PROCESS PORK  :              19.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/03       110.8      57.00   75.63   60.18  36.54 101.57 38.63  72.31
Change :                0.21    0.70   -0.17   1.06   0.36 -0.13  -0.10
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Feb 03, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .62 lwr   :   .64 lwr   :   .66 lwr   :   .19 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 42.50-61.49 : 45.00-61.49 : 45.00-61.49 : 42.50-60.81
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.24    :    58.90    :    59.20    :    54.28
--------------------------------------------------------------------------
Head Count      :   34,012    :   14,994    :   20,402    :   13,598
==========================================================================

Hog Comments - 02-02-09 What goes up must come down I guess.

2009-02-02T15:32:00.092-06:00

CORN - March '09 Electronic
Open - $3.78, High - $3.78, Low - $3.63, Close - $3.70 1/2 Down $.08 1/2

The March '09 contract was obviously certain it didn't care about the $3.77 support area that I spoke of last week. To re-cap, I said the market had support at $3.77 and if it failed to hold we could see the $3.59 area in the March '09 contract. Today confirmed that thought when the market fell apart in the early part of the session and traded as much as down $.16 at one point to make a low of $3.63.

I am buying into this decline against my $3.60 puts that I have in place. If I buy futures against my put options it turns them into a synthetic call option which gives me upside protection but has limited risk to the downside. The march contract had recovery type trade after the first hour of trading was in the books today. We made our low around 10:20 a.m. CST and moved higher from there. The forecast remains wet for South America this week which is what lead to today's weakness on a fundamental front.

Bottom line - It looks like we need to get back above $3.70 1/2 and trade there for awhile if we want to make a run at $3.77 which went from support to resistance now. As of this point I don't think March '09 corn will close any lower than $3.59, I think this support level will hold. The market is still respecting the 50% retracement level (back to the $3.05 1/2 low on 12-05-08) of $3.67 1/4 and if we can stay above this level we should have another run toward the recent high of $4.29. I think we will have an early low tomorrow and a late high. I look for resistance at $3.72 1/4 tonight and $3.78 if we can get things going. Look for better trade tomorrow.

MEAL - March '09 Electronic
Open - $310.00, High - $310.00, Low - $299.60, Close - $306.20 Down $4.80

March '09 meal broke the $305.00 support level that I spoke of last week but yet again failed to close below it. I actually liked today's trade action, we made new lows and buyers came back into the market and pushed meal above the $305.00 support level. As I said last week we need to see a close below $305.00 if we want to see my target of $292.00 become reality. We got below $300.00/ton today with a low of $299.60 but the market saw buying going into the latter part of the session.

Bottom line - Like I said, I liked the way meal traded today and it warrants ownership of at minimum call options to cover meal needs. I currently have call options on myself and will add to my position when the market tells me to. Today gave a warning sign of a potential short-term bottom in March '09 meal. I need to see the market close above $310.00 before I believe it. I expect early lows and late highs tomorrow and I look for $309.00 to be resistance for the trade tonight and tomorrow.

HOGS - April '09 GLOBEX
Open - $62.60, High - $63.00, Low - $61.50, Close - $61.67 Down $1.30

We took back most of Friday's lovely gains today and closed below the 62% retracement level of Friday's range. This would suggest a possible test of Friday's $60.70 low. I don't think we have it in the market to get to this price level based on the way the market traded the later hours of the session today. April slowed down and the ranges narrowed therefore making me thing we could make a move higher tomorrow.

I have the market on a cycle lower until 4:00 a.m. Tuesday morning and then working its way back higher. This is all based on the intra-day 60 minute chart but is usually reliable as relaible can be in this business that is! I still like the way the market traded and closed last week and I think we are finally beginning to get what I have been waiting for. If the market can get back to last week's high of $64.70 we could see some buy stops above this level.

Bottom line - the market is in an up cycle now until Feb 13th, 2009 but it isn't anything violent just a steady upward move. This isn't a science so anything can happen but it meshes with what I see on the weekly chart although I need more confirmation before I say the April '09 hogs have bottomed. I expect early lows and late highs tomorrow with a test of $62.00 to $62.37 likely. Cutout was almost a non-event this afternoon and the cash report wasn't as bad as the noon report suggested it would be, typical really. I'm looking for better trade tomorrow.

NW_LS500
Des Moines, IA     Mon, Feb 02, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh loins steady to weak;
butts generally steady; sknd hams and sdls bellies 14-16 lbs not tested; lean
trimmings steady to firm. Trading slow, with mostly light demand and light to
moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              36.0
Loads TRIM/PROCESS PORK  :               8.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
02/02        44.0      56.79   74.93   60.35  35.49 101.20 38.76  72.41
Change :               -0.15    0.54    0.61  -3.32  -0.13  0.09    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Feb 02, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .84 lwr   :  1.53 lwr   :  1.17 lwr   :   .34 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 42.50-62.00 : 47.50-61.49 : 46.00-62.00 : 42.50-60.81
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.67    :    59.10    :    59.69    :    54.31
--------------------------------------------------------------------------
Head Count      :   21,293    :    7,966    :   13,206    :    8,007
==========================================================================

Hog Comments - 01-28-09 - We did it, an up day in hogs!

2009-01-28T15:32:00.119-06:00

***NOTICE - I may not have a post tomorrow due to my schedule.***

CORN - March '09 Electronic
Open - $3.78, High - $3.86, Low - $3.72 1/2, Close - $3.84 1/2 Up $.07

March '09 corn did what I thought was going to do today, I expect us to have an early low and a late high which is what happened. The opening got off to a lower start but it didn't take long for the market to trade in positive territory. This morning I bought back some of the futures positions I exited last week, made $.05 and exited them because of the way the intra-day charts look. The futures were purchased against my $3.60 puts that I own so the market couldn't get away from me to the downside.

It looks like corn should open better tonight and rally early on and then settle into a mixed mode until morning. The weather forecast for South America dried up some for the weekend but there's still a system coming in next week that is supposed to bring good moisture. The market will probably keep some premium in the market because of the drier weekend forecast but with next week's system still in play I don't think we will get crazy to the upside. The reason I purchased corn this morning is because we held the $3.77 number I spoke of yesterday.

Bottom line - with an expected better opening tonight I see the trade making a small move higher and then drift from there. I see today's high of $3.86 as resistance for tonight and I see support at $3.79 1/4 to $3.77 1/2. I think we can see $3.79 1/4 but not so sure on the $3.77 1/2 as of yet. The Dow Jones rallied after the grain markets closed so it may help the commodities remain firm. $3.77 is still a very key number as far as I am concerned.

MEAL - March '09 Electronic
Open - $308.00, High - $314.80, Low - $304.00, Close - $311.50 Up $2.90

I said yesterday that $292.00 looked like a target area for March '09 meal but we needed to close below $305.00 first. We got as low as $304.00 today but failed to close below this support number. Meal was stronger today in conjunction with soybeans and corn based on the South American weather forecast. I did buy back some of the meal I exited last week and earlier this week. I averaged a price of $313.00 which is currently above the market.

I bought the meal futures against the $290.00 puts I have in place to protect the downside of the market if it should continue to drop. I am still not a fan of meal at this point but with the weather forecast turning drier over the weekend I wanted some of the coverage back in place which is below where I exited my original positions anyway.

Bottom line - $309.90 and $308.70 are support areas for the market tonight and tomorrow. I also see today's low of $305 as a support area but I don't think we will get that low unless we see a forecast change. I think the market will open firmer tonight and make a run toward today's high of $314.80 but I don't think we will get that high. I think we will have an early high tonight and late low tomorrow.

HOGS - April '09 GLOBEX
Open - $60.80, High - $61.775, Low - $60.40, Close - $61.35 Up $.65

April '09 had a nice little recovery day but it didn't do anything to the charts to make me get too excited about a major rally. April '09 finally did what I thought it would do today; we had an early low and a late high. I said yesterday that we could see a retracement up to $61.35 which is exactly where we closed the market today. I also said we could see more selling below $60.25 (yesterday's low) if we got there but we didn't reach those levels.

I have a cycle buy area which came in on Monday for the April '09 contract and it has the market rallying into February 11th, 2009. This doesn't mean it'll happen but it's been a pretty reliable tool over the past year. Today was the first day since January 6th, 2009 that the April '09 futures have closed above where it opened; and we haven't closed above a previous day's high since January 2nd, 2009!

Bottom line - tomorrow will be important technically for me, I would like to see the April '09 futures close above $61.775 which was today's high. If we do that it will be the first time since Jan 2nd, 2009 as I mentioned before. If we can do this we should test $63.07 at some point in the near future. I see the market as mixed to higher tomorrow so hopefully we get our close above $61.77. I am looking for an early low and a late high in April '09 futures tomorrow.

NW_LS500
Des Moines, IA     Wed, Jan 28, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh bone-in loins unevenly
steady; butts mostly 1.00-2.00 lower; sknd hams 20-27 lbs steady to 2.00 lower;
sdls bellies 14-16 lbs generally steady; lean trimmings mostly 1.00 lower.
Trading moderate, with mostly light demand and moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :            133.38
Loads TRIM/PROCESS PORK  :              20.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/28       153.4      57.62   76.53   59.88  37.69  99.29 39.41  73.39
Change :               -0.52   -0.25   -1.65   0.73  -1.23 -1.28  -0.49
-----------------------------------------------------------------------

THE CASH PRICE REPORT WAS NOT UPDATED BY THE USDA AT THE TIME OF THIS BLOG POSTING.

Hog Comments - 01-27-09 - Hogs continue to slide along with grains.

2009-01-27T14:32:00.110-06:00

CORN - March '09 Electronic
Open - $3.92 3/4, High - $3.96 1/4, Low - $3.76 3/4, Close - $3.77 1/2 Down $.16 1/4

March '09 did what I expected it could do today, test the $3.83 3/4 level however the market didn't stop in that area. The weather forecasts continue to confirm moisture in the dry areas of South America and it has the market on edge as we can tell by today's sell off.

$3.83 was the 50% retracement level back to our most recent low of $3.58 3/4. If the market has a shot at challenging our most recent high of $4.07 the market needs to get back above $3.83 otherwise I see a test of $3.58 3/4 which is my next target area. Like I said yesterday I only have around 22% of my needs covered with a call option and I look to buy futures against some $3.60 puts I own in March '09.

Bottom line - I expect the market to open weaker tonight and trade lower in the beginning hours of trade. I expect the market to make an early low tonight and firm going into tomorrow's trading session. I don't think we will see a test of $3.59 tonight or tomorrow, I think we will have an early low tomorrow and then firm as the day goes on. If $3.77 holds as support we may not see $3.59 at all because $3.77 is a 62% retracement back to the $3.59 number. I will be looking for clues tomorrow to see if I want to re-own the feed corn I exited last week. I expect early lows and late highs tomorrow.

MEAL - March '09 Electronic
Open - $316.40, High - $320.60, Low - $306.00, Close - $308.60 Down $7.70

March '09 meal didn't have any issues with selling off today along with soybeans and almost every other Ag commodity. I said yesterday I liquidated the remaining long soybean meal contracts I had in place and I then turned around and bought some $290.00 March '09 puts for $5.50 to buy futures against if/when the market drops. I didn't like the way the meal chart looked and today it finally gave way to what the charts had been warning us about.

Bottom line - The meal market feels like it should open lower like corn, trade lower for a period and then turn and start firming going into the morning. If the market trades firmer like I think it could do, I see $309.80 to $310.60 as resistance for tomorrow. I feel like the market wants to test the $292.00 area but we need to get and close below $305.00 before I make that prediction although I feel $292.00 is a likely target. I expect early lows and late highs tomorrow.

HOGS - April '09 GLOBEX
Open - $62.80, High - $63.07, Low - $60.25, Close - $60.70 Down $2.075

April '09 hogs didn't leave much time for those that were uncertain this morning. The market opened lower and didn't look back. Noon cash reports were $3.00+ lower in IA/MN and the Western cornbelt which seemed to have been traded prior to the reports being released. Once the reports were released the market just settled into an approximate trade range of around $.35 or so.

In Friday's comments I said we needed $64.02 to hold otherwise we could see another leg lower. The market failed to hold $64.02 yesterday and closed well below it and just furthered the downward slide by $2.07 today. I said yesterday I thought we could see a recovery back to $63.70 area and find resistance. I was off by $.62 as $63.07 was as high as we got in the Globex trade. I have to say I only could have been more wrong about today's action if I would have told you yesterday that I expected hogs limit up today! I also said yesterday that we broke a key level of support for me and I was going to use some put spreads to cover some downside risk for now until the market turns. I didn't get my options filled today but I sold futures as a delta hedge until I can get my put spread purchased.

Bottom line - It looks the market ran out of steam after the first hour of trade and the open to close ranges of the last couple hours were very narrow which suggests a slowdown in the directional move. With this being said I also have a cycle indicator moving higher for tonight and tomorrows markets. With all of this being said it looks like we could move higher tomorrow but the same setup was there yesterday and we all know what happened today! I have to go with what the charts are saying for tomorrow and that would be for a small retracement to around $61.35 at some point in the day but I am not going to hold my breath. We should see more selling below $60.25 tomorrow if we get that low. I expect early lows and late highs tomorrow.

NW_LS500
Des Moines, IA     Tue, Jan 27, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Monday's Close:         Fresh 1/4" trim loins weak to
3.00 lower; butts 1.00-2.00 lower; sknd hams 20-23 lbs steady to 2.00 lower,
23-27 lbs steady; sdls bellies 14-16 lbs steady; lean trimmings mostly 2.00
lower. Trading slow to moderate, with mostly light demand and moderate offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             97.25
Loads TRIM/PROCESS PORK  :              28.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/27       125.3      58.14   76.78   61.53  36.96 100.53 40.69  73.88
Change :                0.39    1.09   -1.16   0.29   0.13  0.19   0.98
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Tue, Jan 27, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.95 lwr   :  2.33 lwr   :  2.61 lwr   :  1.60 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 43.00-61.75 : 43.00-61.75 : 43.00-61.75 : 43.00-57.50
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    55.73    :    56.80    :    56.92    :    53.41
--------------------------------------------------------------------------
Head Count      :   30,360    :   16,774    :   20,059    :   10,295
==========================================================================

Hog Comments - 01-26-09 - Grains shaky at best, hogs down again.

2009-01-26T13:25:00.008-06:00

CORN - March '09 Electronic
Open - $3.93 3/4, High - $4.02 1/2, Low - $3.83 3/4, Close - $3.93 3/4 Up $.03 1/4

More of the same today for March '09 corn, we open with strength but can't seem to keep it going throughout the trading session. The weather is still traded based on forecast over the actual event so it seems. With that being said some weathermen had more moisture in their forecasts than others until the noon update, then there were several that changed theirs to wetter as well.

I haven't changed my mind about corn since my last posting; I am still looking for a short-term correction down to the $3.59 area. The charts AGAIN gave a warning signal today if you are long the market; I am out of my feed positions other than a call option on 22% of needs. I DO want to own corn for the long term but I don't want to at these levels, I think we will have a better opportunity to own it cheaper.

Bottom line - It looks like we should see March '09 corn move lower tonight and test $3.90 3/4 to see if we have support. If there isn't any support at this level then our next stop will be $3.87 and then $3.83 3/4. I would not be surprised to see $3.83 3/4 tested either tonight or tomorrow, so once again weaker trade is expected for tomorrow.

MEAL - March '09 Electronic
Open - $320.40, High - $325.00, Low - $309.90, Close - $316.30 Down $2.00

March '09 meal didn't catch fire early in the session like soybeans did, on its high the market was only up $6.70 which was during the first hour of trade. Soybeans however got as much as $.32 1/2 higher during the first hour of trade. Meal only made it 33.5% of the way to its limit move and soybeans made it 46.5% of the way to its limit. Meal was a flat out lager today.

Crude oil was both up and down fluctuation $3.39 from high to low. The enthusiasm was during the morning hours of trade and then crude backed off in conjunction with the Dow Jones. The U.S. Dollar was weaker today down over 80 points for most of the day which in theory is good for commodity prices. Most of the volatility today came from weather forecasts as I mentioned in the corn comments above. The March '09 hasn't proven it yet but the action we had today is similar to that of a top in the meal market.

Bottom line - I still need some confirmation to call a top but I liquidated the remaining few contracts of meal I had and purchased some March '09 $290.00 puts to buy futures against if/when the market drops to those levels. A long put and a long future is called a synthetic call option where it works near the same as a call option. If we are comfortable with the market and think it's moving higher we can salvage some cost of the put option and still have our long futures in place. If you are straight long a call option you have to keep it in place and let the market move through the entire premium you paid before your call begins to return you intrinsic value.

HOGS - April '09 GLOBEX
Open - $64.70, High - $64.70, Low - $62.70, Close - $62.775 Down $1.62

April '09 hogs didn't have a very good day AGAIN today closing down $1.62 at $62.77. I said in Friday's comments (which I posted Saturday morning) that we needed $64.02 to hold support but the market fell short of that today. April hogs broke support and kept moving lower without looking back. I would like to see the market move back above $64.02 tomorrow although it would be a very healthy move higher if it did.

I have been waiting for this market to bottom so we could hedge on a bounce, we haven't seen it yet. We have now broken below a support level by a significant amount and I will be looking to place hedges (via put spreads) on hogs that need to go to town in the near future. I still believe the market is looking for a bottom and once the selling runs out we could see a nice pop in the market but the question is evident. When?

Bottom line - a majority of the downward movement came in the first hour of trade today. The hourly session's ranges became smaller as the day moved on therefore slowing down. I expect some better trade tomorrow with a possible run at $63.70, the 50% retracement level of today's trade range. I say this with the assumption there will be nothing crazy going on in the cash market tonight. Better trade is expected in the April '09 futures for tomorrow.

NW_LS500
Des Moines, IA     Mon, Jan 26, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Friday's Close:         Fresh retail cuts steady to
weak; sknd hams 17-20 lbs weak, 20-23 lbs steady, 23-27 lbs weak; sdls bellies
14-16 lbs steady to 1.00 lower; lean trim firm. Trading slow, with light to
moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :              48.0
Loads TRIM/PROCESS PORK  :               8.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/26        56.0      57.75   75.69   62.69  36.67 100.40 40.50  72.90
Change :               -0.06    2.15   -0.41  -2.29  -0.61 -0.43  -1.22
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Mon, Jan 26, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :  1.11 lwr   :  1.25 lwr   :   .89 lwr   :   .62 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 44.00-62.16 : 44.00-62.16 : 44.00-62.16 : 44.00-59.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.50    :    59.07    :    59.56    :    54.91
--------------------------------------------------------------------------
Head Count      :   24,405    :   10,407    :   13,319    :   10,554
==========================================================================

Hog Comments - 01-23-09 - Wild day in the grains but hogs knew their direction.

2009-01-24T10:03:00.011-06:00

CORN - March '09 Electronic
Open - $3.85, High - $4.01, Low - $3.80 1/2, Close - $3.90 1/2 Up $.03

March '09 corn got off to a great start Friday morning as it opened $.04 lower and rallied from there. The first hour trade was positive in the sense it was trading higher than where it opened at 10:30 a.m. CST and as I have said before if that happens statistically we will close above that level approximately 80% of the time. That was the case today, we closed higher than where the day session open was.

I was reviewing my comments from Thursday as Friday's trade progressed and thinking wow, I am 0 for 3 today on market direction. Everything I thought would happen didn't, I did expect a test of $3.83 1/2 to $3.82 1/4 which did happen except it was in the overnight trade session vs. the day session. The market also filled the gap area I spoke of at $3.90 1/4 and rallied right through it. The talk was less production out of South America and the general belief that beneficial rains would not fall in South America this weekend.

Bottom line - We have traded above $3.93 3/4 three of the last four trading days but have failed to close above it. $3.93 3/4 is the 50% retracement level back to the most recent high of $4.29 on Jan 6th, 2009. If we continually fail to close above this number I believe we will test $3.58 3/4 which is where I believe the market can go. If we do get to this level I will be aggressive in covering feed corn needs for the future because I AM NOT a long-term bear of the corn market. I expect weak markets on Sunday night and Monday but of course we are subject to the rains in South America but I still go with a lower call.

MEAL - March '09 Electronic
Open - $316.40, High - $326.00, Low - $314.80, Close - $318.30 Up $0.10

Action in March '09 meal today was a fluke in my opinion; it is the spec crowd betting on the rains that may happen in South America this weekend. Like I said in the corn comments will be seeing a big reduction in soybean and corn production from South America if the dryness persists. If indeed it stays dry we see continued support in the meal market just as it has been supported thus far on the issue of South American dryness.

Bottom line - I am still not a big fan of higher prices even though I was eating crow for most of Friday's day trade session. I still have some upside on meal but it is minimal at best, I am waiting for a pull back toward $281.00 March '09 to extend my coverage again. This week is the third out of the last four weeks to give warning signals that a top may be near. I am being patient for now in regards to owning soybean meal. If rains fail to materialize and it sends the market higher it will change the look of the charts which in turn will change my mind but for now I will stand aside. I look for weak trade Sunday and Monday.

HOGS - April '09 GLOBEX
Open - $65.45, High - $65.45, Low - $64.02, Close - $64.40 Down $1.00

April '09 hogs have me eating my words to some degree today as I thought the market would hold support and rally. I said April hogs had support at $65.35 but if we trade below this level for a couple of hours we could test $65.12 and then $64.40 (which I thought was unlikely). The market bottomed out today at $64.02 before settling right at my number of $64.40.

As I have been saying for some time now I am still waiting for a bottom to show up but the market is being stubborn. If we close below $64.02 for two straight days we could be in for some extended downside from there. As I said yesterday, the longer the market trades within a range the more explosive the breakout will be. If April does break through $64.02 I may put some hedges in place for hogs going to town in the next 30 days. I do not see the need however to be aggressive with longer-term hedges at this point.

Bottom line - I am expecting sideways to lower trade on Monday as the market continues to look for direction outside of its current range. There isn't much to say other than we need $64.02 to hold as support otherwise we could be setting up for another leg lower.

NW_LS500
Des Moines, IA     Fri, Jan 23, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Thursday's Close:       Fresh loins steady to weak;
butts steady; sknd hams 17-23 lbs steady to firm, 23-27 lbs steady to 1.00 lower;
sdls bellies and lean trimmings not established. Trading slow to moderate, with
light to moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             67.13
Loads TRIM/PROCESS PORK  :
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/23        67.1      57.81   73.54   63.10  38.96 101.01 40.93  74.12
Change :               -0.32   -2.38    1.60   1.84   0.97 -0.32    unc
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Fri, Jan 23, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .92 hgr   :   .53 hgr   :   .63 hgr   :   .04 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 40.25-62.40 : 42.50-62.40 : 40.25-62.40 : 45.00-61.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    58.50    :    60.35    :    60.47    :    54.35
--------------------------------------------------------------------------
Head Count      :   34,270    :   17,538    :   22,813    :   10,947
==========================================================================

Hog Comments - 01-22-09 - Mixed hogs but grains are lower.

2009-01-22T14:42:00.009-06:00

CORN - March '09 Electronic
Open - $3.89 3/4, High - $3.94 3/4, Low - $3.78 1/2, Close - $3.87 1/2 Down $.02 3/4

March '09 corn finished higher in the overnight session but when Microsoft announce 5,000 job cuts the Dow Jones turned south and the Crude Oil market was already trading lower. With all of this happening we saw the opening calls drift to lower instead of a $.02 higher open. The March contract opened down $.01 but quickly sold off in conjunction with soybeans.

The March '09 contract looks top heavy to me, I exited all except around 20% of my long futures position (which are long against $3.60 March '09 puts) as of Friday and Tuesday morning's open. I still have $3.60 puts in place to buy against if the market gets that low or if I change my mind I can get long the market and know that I am not going to be in a situation where the market can move against me that much. I exited March '09 corn at $3.77 and $3.97 on Friday and Tuesday respectively.

Bottom line - I expect corn to continue to see weakness as we had a relatively low volume day today. We have a gap at $3.90 1/4 that we could look to fill tonight and if we do I have a sell signal at $3.88 stop. If the sell stop is filled then I would have a risk management buy stop above the most recent high in the overnight trade. I look for the market to be firm early in the evening trade hours but then fade. I expect tomorrow to be a selloff day with a test of $3.83 1/2 to $3.82 1/4.

MEAL - March '09 Electronic
Open - $320.00, High - $325.20, Low - $313.50, Close - $318.20 DOWN $2.20

March '09 meal was weak along with soybeans today based on South American rain forecasts for the weekend. The forecast is for some rain showers to move through some of the troubled soybean areas. I exited half of my soybean meal contracts on Tuesday morning around $312.50 to reduce my long exposure in the market. I have $300.00 Feb '09 put options in place to protect the downside of the market in the event it would have moved lower but my options have an expiration date of Jan 23rd.

Bottom line - March '09 meal looks like it could test $317.50 to $316.50 for support tonight but I am not a big fan of higher prices right here. We got a warning signal last week and we are setting up to provide another one this week pending on tomorrow's close. I expect weaker trade tonight and tomorrow but the market direction will be influenced by weather forecasts for South America.

HOGS - April '09 GLOBEX
Open - $65.90, High - $66.30, Low - $65.35, Close - $65.40 UP $.05

April '09 lean hogs have been trolling along the bottom of its price range for over a week now but has not built has failed to pick a direction to break out of. The bottom end of the range is the low from January 14th at $64.27 and the top of the range is $67.30. The longer the market trades in this area the larger the move it will have when it breaks out of its range.

The market has experienced good buying below $65.30 in the April '09 contract and I also have a buy signal at $65.55 stop with a risk management protective sell stop at $64.00. The cash and cutout markets were higher today which should bring some stability to futures prices for tonight and tomorrow. Cutout was up $.22 today which isn't much but it beats being lower.

Bottom line - I expect tomorrow's trade in the April '09 contract to be firmer with $65.35 being an area of support, the market settled today at $65.40 just $.05 above support. If $65.35 is violated for a couple hours tonight or tomorrow then we could see a test of $65.12 and then possibly down to $64.40 although I see it as unlikely. I hate to sound like a broken record but I do not want to be extensively short at these levels. I am waiting for a rally opportunity to apply some hedges if the environment feels right. I look for firmer trade tomorrow with an ultimate projection point of $66.30 in the short-term and then $67.12.

NW_LS500
Des Moines, IA     Thu, Jan 22, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh bone-in loins 1.00-2.00
higher; butts steady; sknd hams 17-20 lbs 1.00-4.00 lower, 20-27 lbs steady;
sdls bellies firm on a light test, lean trimmings not established. Trading slow
to moderate, with light to moderate demand and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             81.75
Loads TRIM/PROCESS PORK  :               4.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/22        85.8      58.13   75.92   61.50  37.12 100.04 41.25  74.12
Change :                0.22   -1.85    0.53  -0.87  -0.48  0.02   4.63
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Jan 22, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .35 hgr   :   .81 hgr   :   .70 hgr   :   .63 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 42.00-63.45 : 42.00-63.45 : 42.00-63.45 : 45.00-61.00
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.58    :    59.97    :    59.95    :    54.39
--------------------------------------------------------------------------
Head Count      :   30,685    :   14,039    :   17,515    :   12,790
==========================================================================

Hog Comments - 01-15-09 - No follow through rally on hogs today.

2009-01-15T20:21:00.005-06:00

Please note that my comments will be limited next week as I will be in meetings.

CORN - March '09 Electronic

Open - $3.66 1/2, High - $3.69 1/4, Low - $3.59 3/4, Close - $3.65 1/4 Down $.01 1/4

March '09 corn didn't have much in the way of fireworks today to stay at pace with the soybean market. Fundamentally the market received negative news with at best a dismal export report. The market touched the resistance level of $3.69 ($3.69 1/4 actually) that I spoke of yesterday and couldn't break through.

As I write this the corn market is $.07 higher and I have been selling it tonight to reduce some long futures position I put on yesterday. I am keeping my $3.60 March '09 call options in place for now as I rolled them down from $4.00 with the profits from the short $4.10 March call and long $4.40 call position I put on Friday prior to the report. I exited the short $4.10 March call yesterday because it served its purpose and the position picked up around $.18. I am taking profit on my long futures to stand aside and not have a definite directional position on right now.

Bottom line - I have a potential sell signal at $3.68 3/4 on a sell stop tonight/tomorrow. I would put that order in right now as a sell stop and if it fills I would place a risk managing buy stop to exit the position $.01 above the current high. If the market continues its trek higher tonight and into tomorrow we may see a test of the $3.79 1/2 area that I talked about yesterday. I would definitely sell against that level for now and wait for more direction from the charts. Please do what is right for you, as always these are my opinions and I have the luxury of changing my mind prior to my next blog entry. As always follow your plan!

MEAL - March '09 Electronic

Open - $296.90, High - $316.60, Low - $292.50, Close - $305.00 UP $8.00

March '09 meal took its lead from soybeans today that had a tremendous export number this morning. I am honestly confused by meal at this point and if you will notice the last sentence I wrote in my meal comments yesterday I said "I will continue to keep my calls in place for coverage because what I think and what the market does are two different things. It is very important to know and understand that difference."

My point was proven today, I said I thought if the market got going to the upside $308.00 would provide and hold resistance. The March contract BLEW right through $308.00 today but did settle at $305.00 which is obviously under the aforementioned resistance level. We filled at gap left at $313.20 from Monday and then backed off from there. Based on the way the intra-day charts look, it seems like we could make another run at today's high of $316.60.

Bottom line - If we continue to trade above $304.60 tonight and tomorrow then I think we could make a run at the high of $316.60 but if we fail to stay above $304.50 then we could test $300.00 and ultimately $292.50. The short-term charts suggest tomorrow being a better day tomorrow but be careful if we begin to trade below $304.50 for a period of time!

HOGS - April '09 GLOBEX

Open - $66.30, High - $66.30, Low - $65.30, Close - $65.85 DOWN $.85

I said yesterday I thought we would trade the lower cutout number early and possibly test $65.65 which happened as $65.30 was the low for the day. April '09 hogs failed to mount much of a rally though which was surprising to me from a technical perspective. I guess it is kind of hard to do when packer margin is in the red.

The cutout today was marginally higher, up $.05 and cash was both sides of unchanged. The overnight markets are higher as I write this but nothing major, up $.42. I am expecting a mixed day tomorrow as the market should be finding a low by next week if it hasn't already; I say this as a result of some short-term cycle projections I look at.

Bottom line - The market should remain firm tonight and maybe even early tomorrow as the US Dollar index is weaker tonight and the Dow Jones is trading higher. The Dow Jones looks like it may have put in a short-term bottom here today but tomorrow will be the teller of that story. I look for a test of $66.55 either tonight or tomorrow.

NW_LS500
Des Moines, IA     Thu, Jan 15, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Wednesday's Close:      Fresh loins steady to 1.00
higher; butts firm; sknd hams mostly 2.00 lower; sdls bellies unevenly steady;
lean trimmings generally steady. Trading slow, with light to moderate demand
and offerings.



-----------------------------------------------------------------
Loads PORK CUTS          :             67.75
Loads TRIM/PROCESS PORK  :               5.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/15        72.8      56.26   76.48   60.54  38.20  94.86 40.11  64.76
Change :                0.05    0.17    2.03   0.03   0.28  0.04  -1.41
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Thu, Jan 15, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .61 lwr   :   .08 hgr   :   .02 lwr   :   .21 lwr
Negotiated      :             :             :             :
CARCASS BASIS   : 43.50-63.85 : 44.00-63.85 : 44.00-63.85 : 43.50-59.46
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    57.34    :    59.03    :    59.31    :    54.58
--------------------------------------------------------------------------
Head Count      :   24,432    :   10,086    :   14,304    :    9,198
==========================================================================

Hog Comments - 01-14-09 - The hog market makes a bungee jump!

2009-01-14T14:39:00.009-06:00

CORN - March '09 Electronic

Open - $3.64 3/4, High - $3.69 1/2, Low - $3.58 3/4, Close - $3.66 1/2 UP $.04

Corn showed signs of optimism in the overnight trade but by the time we opened the day session it seemed as though the optimism faded. The market was trading higher than where it opened at 10:30 a.m. CST so that would indicate a good chance the market would close higher than the open which it did.

The March '09 contract made an attempt to test the number I mentioned Monday afternoon, $3.54 but we only got as low as $3.58 3/4. We also settled near the $3.68 number I spoke of on Monday but settle just shy of it at $3.66 1/2. The action today has the feeling of bottom searching; we neared the 50% retracement level and held support as well as rallied. If we continue to close above $3.53-.54 I will look for the market to make another rally attempt.

Bottom line - The feeling I get after today's action is we will continue to move higher in the overnight session. The first area of resistance is $3.69, then $3.71 and all the way up to $3.79 1/4 although $3.79 1/4 is a big stretch and I don't think we will get there. We need to continue trading above $3.69 for a period of time before I get excited about $3.79 1/4. I do think we will see some buy stops above today's high of $3.69 1/2 either tonight or tomorrow. I'm looking for follow-through positive trade tomorrow.

MEAL - March '09 Electronic

Open - $295.70, High - $300.70, Low - $293.50, Close - $297.00 UP $2.00

I said Monday I thought March '09 meal could test $278.20 to $268.00 and we have only gotten as low as $292.40 since Monday's down limit day. I must say it is somewhat confusing to me. I am still holding on to a cautious approach to March '09 meal because even though it closed higher today it hasn't done anything on the charts to make me change my opinion.

If March '09 gets on a roll to the upside for some reason we should see good resistance at $308.00 on the daily charts. I think this area will stop a rally if one develops from short-covering from Monday's selloff. The market seems firm because it isn't breaking like it looks like it should but I am not bullish here.

Bottom line - if the market decides to continue moving higher tonight which I think it will, we should see near-term resistance at $297.90 and $300.70. We can't seem to break away from the $300.00 level in either direction. I will continue to keep my calls in place for coverage because what I think and what the market does are two different things. It is very important to know and understand that difference.

HOGS - April '09 GLOBEX

Open - $67.25, High - $67.30, Low - $64.27, Close - $66.70 DOWN $.57.

I said on Monday I thought we were too close to the contract low of $66.57 in the April '09 contract to not test it. The market did it in full force today! We traded down limit in the April '09 Globex contract and slowly found support and rallied back for the balance of the day. I also said I didn't want to hedge unless we close the week below $66.57 and I need to wait two days to find out if I need to employ a strategy.

Today's action looked very pretty on the daily chart. We opened lower, tanked and then came screaming back to close out the day. We also close above the previous contract low of $66.57 which was important to me. The cash prices are higher this afternoon but cutout was down $1.64 but the market hasn't really sold off in after hours yet. Today was the last day of the Goldman roll so the hog markets should get back to normal. If we are in 2009 it is okay to use the word normal in conjunction with the markets right?

Bottom line - I expect continued strength tomorrow but we may need to get the cutout number traded early in the session. We could test $65.65 early in the session and then catch some support. If we end up moving higher tomorrow I expect buy stops above today's high of $67.30 and should accelerate buying. Higher cash and lower cutout isn't good for cash margins on the packing side so something has to give sometime. Which will it be, cash or cutout?

NW_LS500
Des Moines, IA     Wed, Jan 14, 2009     USDA Market News

USDA NATIONAL CARLOT PORK REPORT as of:  3:00 P.M.
Purchases equated to FOB Omaha Basis.

Compared to Tuesday's Close:        Fresh loins steady in light
test; butts mostly steady to firm; sknd hams 17-20 lbs steady, 20-27 lbs
2.00-4.00 lower; sdls bellies 14-16 lbs not established; lean trimmings steady
to firm. Trading slow to moderate, with light to moderate demand and mostly
moderate offerings.


-----------------------------------------------------------------
Loads PORK CUTS          :              88.0
Loads TRIM/PROCESS PORK  :              16.0
-----------------------------------------------------------------

USDA ESTIMATED PORK CARCASS CUTOUT
Based on FOB Omaha carlot pork prices and industry yields.

           Calculations for a 200 lb Pork Carcass
        53-54% lean, 0.65"-0.80" backfat at last rib
-----------------------------------------------------------------------
         Total                   Today's Primal Cutout Values
Date     Loads      Carcass    Loin    Butt   Pic     Rib   Ham  Belly
-----------------------------------------------------------------------
01/14       104.0      56.21   76.32   58.50  38.17  94.58 40.07  66.17
Change :               -1.64    0.66    0.89  -5.87  -0.26 -5.55   0.90
-----------------------------------------------------------------------

NW_LS831
Des Moines, IA     Wed, Jan 14, 2009     USDA-IA Dept of Ag Market News

National Direct Hog Price Comparison

--------------------------------------------------------------------------
                :  National   :    Iowa     :   Western   :   Eastern
                :             :  Minnesota  :  Cornbelt   :  Cornbelt
--------------------------------------------------------------------------
   Base Price is the price from which no discounts are subtracted and
   no premiums are added.
--------------------------------------------------------------------------
BARROWS & GILTS :   .34 hgr   :   .46 hgr   :   .57 hgr   :   .86 hgr
Negotiated      :             :             :             :
CARCASS BASIS   : 43.00-62.84 : 44.00-62.84 : 43.00-62.84 : 44.00-59.46
185 lb Base Hog :   wtd avg   :   wtd avg   :   wtd avg   :   wtd avg
Plant Delivered :    58.10    :    59.54    :    59.79    :    54.78
--------------------------------------------------------------------------
Head Count      :   28,764    :   15,627    :   19,070    :    9,506
==========================================================================