Chicago | Reuters –– Chicago Mercantile Exchange livestock futures ticked higher on Thursday, boosted by short-covering and technical buying after prices probed new lows earlier this week, traders said.
Futures for cattle and lean hogs notched narrow gains despite fears of weaker prices in cash markets and a lower trend in wholesale meat values — as well as expectations that U.S. pork and beef exports could drop due to tariffs on various meat cuts in China and Mexico.
Hog futures had eased to life-of-contract lows on the first three days of the week, before recouping a portion of those losses. The most-active August hogs contract finished 1.625 cents higher at 70.425 cents/lb. (all figures US$).
CME August live cattle was 1.175 cents higher at 105.025 cents/lb. and August feeder cattle 1.625 cents higher at 151.025 cents. Each recovered from falling on Wednesday to the lowest levels so far in July.
The U.S. Department of Agriculture in a monthly supply and demand report predicted increased production of U.S. red meats of beef and pork this year.
USDA in daily reports said wholesale choice-grade beef prices declined 86 cents, to $206.58/cwt, and pork prices eased nine cents to $83.51/cwt. Meat prices have fallen since the U.S. Independence Day holiday on July 4. Retailers stock up on supplies for outdoor grilling for the holiday and then generally slow purchases.
“Boxed beef continued to drift lower as summer heat continues to take its toll on demand,” CHS Hedging said in a market note.
Hogs in the top cash market of Iowa and southern Minnesota dropped $2.44 to $73.68 per cwt, according to USDA.
Few cattle have traded yet this week in cash markets, CHS said.
— Michael Hirtzer reports on commodity markets for Reuters from Chicago.