U.S. Midwest hogs drop $1-$2 as packer demand fades

April 21 (Reuters) - U.S. Midwest cash hogs moved $1 to $2 per hundredweight (cwt) lower on Monday amid slack demand with some packing plants closed for Easter Monday holiday observances, dealers said. Packers need fewer hogs after taking off for Good Friday with several processors using Monday as a floater holiday, creating more hogs to go around, a Midwest hog dealer said.

Some hog dealers believe cash hog prices could mount a comeback by midweek given improving packer margins.

And hogs could be hard to come by as the deadly Porcine Epidemic Diarrhea virus (PEDv) spreads on U.S. farms. 'We didn't have a lot of numbers before the holiday and we could return to a tight supply situation this week,” a hog dealer said.

'Plus, pork business should pick up as better weather helps demand for grilling,” he said.

Friday afternoon's wholesale pork price jumped $1.26 per cwt from Thursday to $121.34, USDA said.

Packer margins on Monday were at a positive $6.95 per head, compared with a positive $1.30 on Friday, and a positive $2.65 a week earlier, according to Colorado-based analytics firm Hedgersedge.com. Market Trend Expected Top Comment (per cwt) Ia/So $1-$2 Country: Unquoted Some packers still out Minn lower Plants: $84 for Easter. Indiana $1.50 Country: $83.00 Reduced kill Monday and lower Friday curbed packer Plants: $84.00 need for supplies. SE Ohio $1 lower Country: $86-$87 Product took a hit Plants: $88-$89 before the holiday, but should bounce back. NW Ohio $1.50 Country: $83.50 lower Plants: $87.50 Illinois $1-$2 Plants: $84-$86 Plants out for floater lower holiday.

Sources: Private (Reporting by Theopolis Waters in Chicago; Additional reporting by Michael Hirtzer Editing by W Simon)