August Hogs Trading in the bottom 25% of Forecast Range – 02/19/2023

Historically August lean hog values have been closely associated with summer pork production, pork exports and the US gross domestic economic income. The  GDI contains both real economic growth and inflation. We have assumed a 2% growth rate in real incomes and a 5% inflation rate for GDI. The summer US pork production and export assumptions have been derived from the February 2023 WASDE report from USDA. 

Based on the stated assumptions the model forecasts a February through August price range of $101 to $127 dollars per hundredweight compared to the close on 02/17/2023 of $105 for the August lean hog contract.