Chicago | Reuters — U.S. cattle futures firmed for the second day in a row on Thursday, with the most-active December live cattle contract holding support near a two-month peak on strong cash prices.
“The cash market has been moving up steadily,” said Don Roose, analyst with U.S. Commodities in West Des Moines, Iowa. “The feeling is that the feedlots have a bit of an advantage here with good packer margins.”
Cash cattle trades in Kansas and Texas were reported at $105/cwt, near the top end of last week’s prices, traders said (all figures US$).
December live cattle futures closed up 0.2 cent at 110.825 cents/lb.
November feeder cattle futures closed up 0.425 cent at 142.1 cents/lb.
Hog futures closed weaker, pressured by a third straight day of profit taking after rising 9.5 per cent during the last 10 days of September.
December lean hog futures dropped one cent to 68.1 cents/lb. at the Chicago Mercantile Exchange but closed well above the 10-day low of 67.15 it hit during the session.
The contract hit resistance at its 10-day moving average.
Traders continued to monitor the spread of African swine fever.
China’s hog herd fell by half in the first eight months of 2019 due to a devastating outbreak of African swine fever and will likely shrink by 55 per cent by the end of the year, analysts at Rabobank said on Wednesday.
South Korea confirmed two additional cases of African swine fever at pig farms in towns near its border with North Korea, the country’s agriculture ministry said on Thursday.
The devastation of Asian hog herds could boost export demand for U.S. pork.
The U.S. Agriculture Department said pork export sales totaled 34,400 tonnes in the week ended Sept. 26, up slightly from 32,200 tonnes in the prior reporting week. This week’s total included 4,900 tonnes of sales to China.
Weekly beef export sales fell to 12,600 tonnes from 19,100 tonnes.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.