For those of you who have fallen asleep waiting for the summer hog rally, it may be time to hit the floor and pour some hot, strong coffee. Watching hog and pork prices through the first half of the season made paint drying seem suspenseful. But there are signs this week that fundamentals have turned a big corner.

I'm not bold enough to rekindle $90 expectation. The hour has probably grown too late for such enthusiasm. On the other hand, the stage may be set for the establishment of new summer highs sometime between now and late August.

While pork processors have been quite skillful since the spring price crash in juggling market hog receipts and contracts in a way that didn't force their hand in terms of chain speed, it sounds like they may be running out of luck as well as ready barrows and gilts.

I think at least two factors are stepping up to sponsor this late summer party: 1) the marketing hole suggested by the June 1 weight-breakdown, the one tied to the 50-119# category (i.e., 5 percent below 2009); and 2) the impressive (and contagion) wholesale strength of chicken and beef.

The competition in the meat case is such that pork still looks relatively affordable if not the best buy for retailers in terms of margin potential.

Needless to say, the trouble with a late start is a more limited window of opportunity. Sometime in late August, producers will become extremely nervous about the traditional increase in fall numbers and the ensuing implosion in packer bids.

Indeed, many are already waiting for the other shoe to drop in that regard. That's why October lean futures closed on Thursday as much as 622 points under spot August. As big as that canyon looks, it's likely to widen even more over the next month.

In fact, the hotter cash and August burn in the weeks ahead, the greater four-quarter discounts are likely to look.

For more Harrington comments check out www.feelofthemarket.com

(KM)

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