Allan Bentley, Sales, Genesus Genetics
I have asked Bob Lingenfelter to add his thoughts as we are both predicting higher prices. Bob and I have argued about markets for 30 years. Of course, Bob played football for Nebraska and then went on to play for the Browns and the Vikings so I don’t argue too loud. Bob does his daily radio market report then a rap up on Saturday. I follow and pay attention to fundamentals and Bob is a technical analyst. At Christmas, I predicted summer hogs at $100. That fired up Bob. This week he tells me that his charts are showing we will reach $108. At least we both agree to the direction.
I am going to concentrate on fundamental issues why we are heading higher and then I will let Bob add his chart wizardry.
This morning I just read about another ASF outbreak in Sichuan. That is the largest hog-producing province in China. Of course, they say it was found in 38 pigs. My guess is you can add about six ‘zeros to that number of 38. The long and short is ASF is not going away anytime soon in China. Their appetite for pork will have to come from outside China. The U.S. is in a position to take advantage, barring some political event. I have to throw that in as politics can and does dictate market direction.
Jim Long, in his commentaries, has pointed out how many finishing barns are empty. He is correct, in every level of hog production we have empty barns. I work with vets closely and everyone agrees the PRRS and PEDv is as bad as any year in the recent past.
Packers are not as aggressive filling Saturday kills. That is only because they do not want to push markets higher than they have to and keep supplies moving. I had a pig broker tell me he would pay $90 for 40 lb. feeders this week. Pig Brokers are finally having to earn their commission. I bet we see $100 feeder pigs soon. With that being said, below is Bob’s technical input.