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Even after the surge higher yesterday, February hogs hold just a 115 point premium to the cash market. Solid gains in pork cut-out this week should spark more aggressive demand from packers to move as many hogs as possible through the pipeline as profit margins are high. This is exactly what the market needed to clean up any backlog of hogs in the country from the recent long cold spell. Better than expected action in the cash hog market helped spark aggressive short-covering yesterday and new fund buyers were active as well. News of the highest pork exports in November (up 11% from last year) since October of 2008 helped provide underlying support. The market surged sharply higher on the session yesterday with February hogs pushing to the highest level since May 13th. Average weights from Iowa/Minnesota for the week ending January 9th came in at 269.0 pounds, up from 268.3 the previous week and down from 270.6 pounds last year. “Less” pressure than expected in the cash market from the warmer weather in the Midwest added to the short-covering support for the market. Cash is called steady to lower for today. The CME Lean Hog Index as of January 11 came in at 67.82, up 20 cents from the previous session and up from 64.74 the week before. The estimated hog slaughter came in at 425,000 head yesterday. This brings the total for the week so far to 1.274 million head, down from 1.285 million last week at this time but unchanged from a year ago. Pork cut out values, released after the close yesterday, came in at $72.56, up $1.33 from Tuesday and up from $69.12 the previous week. This is the highest pork price since October 6th as cash bellies were very strong.