Hog Hedgers Turn Net Long for the First Time in the Data
Long story short: For the first time in twenty years of data, the producers and merchants who hedge lean hogs are net long. They have closed 83% of their shorts since February. On the other side, large speculators hold another record short.
In this story
Source: CFTC Disaggregated report, futures only, weekly from June 13, 2006 to October 27, 2026.
Two weeks ago, this series reported the biggest bet against lean hogs in the data. It closed with a note on the hog trade. The producers who hedge on the other side were net short only 1,389 contracts, and a net long would be a first in the data.
As of October 27, that first is here. Producers and merchants hold 31,393 long contracts and 30,324 shorts, a net long of 1,069. The Disaggregated report has tracked the group since 2006. In no week before has it been net long.
The group stands for the physical hog business: farms, meatpackers and processors. Their positions are mostly hedges. A producer that sells futures locks in a price for hogs it will bring to market months later.
The Hedges Came Off
The net long did not come from new buying. Since February, the group’s longs have barely changed, from 34,048 to 31,393 contracts. What changed is the short side.
In February, producers and merchants held 176,595 short contracts, the most in the data. Since then, they have closed 83% of them. At 30,324 contracts, their shorts are the fewest since July 2009.
Source: CFTC Disaggregated report, futures only, weekly from January 2024 to October 27, 2026.
The turn took thirteen months. In September 2025, the same group was net short 147,961 contracts, the largest net short in its data.
Speculators Set Another Record
The other side of the market moved the opposite way. In the Legacy report, large speculators are net short 82,361 contracts, the largest since the data began in 1996. Their 167,609 short contracts are also the most in the data.
Money managers, the hedge funds and commodity trading advisers of the Disaggregated report, hold 123,037 shorts, another record. Their net short of 51,646 contracts is the largest since 2006. Of the money managers in this market, 81 are short and 55 are long.
The hog trade has cut its hedges to the fewest since 2009. The speculators are selling more than ever.
Who Holds the Long Side Now
The commercial side of the Legacy report is net long 81,275 contracts, the most since 1996. Most of it belongs to swap dealers, the banks behind commodity index and swap products. Their net long is 80,206 contracts. Producers and merchants add the other 1,069.
The report shows positions, not reasons. Producers may hedge less because they expect higher prices, or because they have locked in prices through contracts outside the exchange. The data cannot tell the two apart. A net long of 1,069 contracts is also close to zero, and one more week of selling would turn it back.
What to Watch Next
- Producers and merchants. Their net long is small. Whether it holds shows if the hedges stay off.
- Money managers. Their shorts set a record again. In two weeks, the number of short holders rose from 77 to 81.
- Swap dealers. They now carry almost the whole commercial long. Whether they keep it shows who takes the other side of the record short.
Source: CFTC Commitments of Traders, futures only, positions as of Tuesday, October 27, 2026. Producers and merchants, swap dealers and money managers come from the Disaggregated report, large speculators and commercials from the Legacy report.
