Chicago | Reuters — U.S. lean hog futures on the Chicago Mercantile Exchange climbed higher on Thursday as tight supply and firm export demand offered support, analysts said.
“A lot of that has to do with COVID and the pent-up demand we have, with more things opening up,” said Joe Kooima, commodity broker at Kooima Kooima Varilek Trading.
CME June lean hogs settled 0.8 cents higher at 108.7 cents/lb., after reaching a high of 108.775 (all figures US$). Nearly all contract months found new life-of-contract highs.
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The CME’s lean hog index, a two-day weighted average of cash prices, climbed to $100.47 per hundredweight (cwt), its highest since Oct. 17, 2014.
Pork exports were noted at 33,400 tonnes the week ending April 1, down 45 per cent from the week prior and 22 per cent compared to the previous four-week average, according to the U.S. Department of Agriculture.
CME live cattle stepped back after climbing the first half of the week, despite continued strength in beef cutouts and the cash market.
CME June live cattle settled 0.25 cent lower at 125.025 cents/lb. after setting a contract high of 125.625 cents, as well as life-of-contract highs nearly all other months.
“I think going into the weekend, we’ll see a little bit of a breather, to see where prices are,” said Matthew Wiegand, Risk Management Consultant at FuturesOne, referring to the processing backups last spring due to COVID-19 outbreaks in meat-packing plants.
Cash cattle traded at mostly $123/cwt in parts of Nebraska, up from $118/cwt a week ago, according to the USDA.
Choice cuts of boxed beef gained $4.19, to $270.50/cwt, climbing $20.53 in the last week. Select cuts gained $8.64, to $263.83/cwt, according to the U.S. Department of Agriculture.
U.S. producers exported 18,200 tonnes of beef the week ended April 1, down three per cent from the week prior and 14 per cent lower compared to the prior four-week average, according to USDA.
Stronger corn markets weighed on feeder cattle.
May feeder cattle futures slid 1.075 cents, to 151.6 cents/lb., notching life-of-contract highs from August 2021 on.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.
