Lean hog futures were mixed on Friday, as positive momentum stalled out ahead of the weekend. April lean hogs traded 40 cents lower to $97.97 per cwt. Prices initially surged at the start of the session in an attempt to test Wednesday’s contract high of $99.80 before reversing those gains. Still, futures closed $2.80 higher on the week.

Volatility has been rising in the hog market again since breaking above their September highs. Friday’s reversal may lead to additional profit-taking, as prices are due for a pullback. Volatility may need to simmer before the market takes another stab at new contract highs.

To reiterate from previous analysis, April hogs have had no meaningful correction since mid-November. The substantially large long position built up by the funds does put the market at risk of profit-taking for the short term.

Federally inspected hog slaughter is estimated at 2.593 million head, up 3.7 percent from the previous week. However, year-to-date slaughter is running 2.7 percent behind last year.

Cash hog prices kicked off the new year on a softer note, with prices signaling a well-supplied market for the near-term. Prices have improved over the past month, as packers became more aggressive to secure supplies. The CME Lean Hog Index reached $86.38 per cwt on Friday.

Wholesale pork prices chopped sideways this week. The USDA pork cutout finished at $93.77 per cwt on Friday, down 45 cents from the previous week. Pork values slipped below year-ago levels this week but have held above the five-year average.

U.S. pork export sales during the week ending Jan. 29 totaled 35,100 metric tons (MT), down from 56,000 MT the previous week. Pork exports and commitments are up since the start of the marketing year, totaling 427,900 MT, up 15 percent year-over-year. Commitments are also running at the fastest pace since 2021.

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PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. FUTURES TRADING INVOLVES SUBSTANTIAL RISK AND IS NOT SUITABLE FOR ALL INVESTORS.