Chicago | Reuters — Chicago Mercantile Exchange lean hog futures closed higher on Friday, supported by short covering before the U.S. Department of Agriculture’s quarterly hog report expected at 2 p.m. CT, traders said.
Analysts expect Friday’s report to show further herd expansion during the March through May quarter compared with a year earlier.
“The market has already priced in some steep supply numbers from USDA, but the question is, how large?” said Allendale Inc. chief strategist Rich Nelson.
July hogs closed 0.8 cent per pound higher at 75.45 cents, and August was up 0.675 cent at 72.825 cents (all figures US$).
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Investors monitored softer cash and wholesale pork prices, with packers needing fewer hogs due to plant shutdowns during the U.S. July 4 holiday.
Retailers are expected to buy small amounts of pork until they determine how much product was sold over the July 4 holiday weekend.
Market-ready (cash) hogs in the U.S. Midwest on Friday morning traded steady to $1/cwt lower than on Thursday, pressured by enough supplies to meet current packer demand, regional hog dealers said.
USDA data quoted Friday morning’s wholesale pork price at $82.35 per cwt, down 29 cents from Thursday.
Live cattle settle weak
CME live cattle posted modest losses, pressured by bearish fundamentals, traders said.
June settled 0.1 cent/lb. lower at 148.4 cents, and August was down 0.05 cent at 148.525 cents.
This week, cash cattle in the U.S Plains sold at mostly $148, feedlot sources said. That was $2 lower than a week ago.
Friday morning’s wholesale choice beef price sagged 63 cents/cwt from Thursday, to $254.53. Select cuts dropped 45 cents, to $249.68, the USDA said.
Packers were less eager to compete for supplies with plants closed during the Fourth of July holiday, traders and analysts said.
Beef demand typically tapers off in early July as the onset of summer heat deters backyard barbecues, they said.
Sell-stops, weak back-month live cattle futures and the recent jump in corn prices dragged down CME feeder cattle contracts.
August closed 1.8 cents lower, at 217.25 cents/lb.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.
