U.S. livestock: CME hog futures slump on pork demand fears

Chicago | Reuters — Chicago Mercantile Exchange lean hog futures fell on Monday, pressured by concerns that the seasonal bump in supplies might further hurt cash prices and curb retail pork buying, said traders.

They said sell stops and fund liquidation hastened hog market losses.

April hogs ended 0.875 cent/lb. lower at 64.8 cents, and below the 200-day moving average of 65.41 cents (all figures US$). May finished down 0.45 cent to 69.4 cents.

Packers are expected to cut back Saturday kills to protect their margins and in anticipation of possible easing product demand through the Easter holiday, said Hehmeyer Trading + Investments senior hog futures trader Tom Cawthorne.

Slaughter-ready, or cash, hog prices have declined over the past seven sessions as supplies grow seasonally.

Monday afternoon’s average cash hog price in Iowa/Minnesota at $62.19/cwt slipped 19 cents from Friday, according to the U.S. Department of Agriculture.

USDA estimated that packers on Monday processed 443,000 hogs, up 2,000 from last week and 9,000 more than a year earlier.

Separate U.S. government data on Monday afternoon showed the average U.S. wholesale pork price 49 cents/cwt higher than on Tuesday at $75.89.

Monday’s average pork packer margins were a positive $21.55/head, up from a positive $19.75 for Friday, as calculated by HedgersEdge.com.

Cattle futures end lower

CME nearby live cattle contracts finished weaker after investors sold April futures and simultaneously bought deferred months in anticipation of softer cash prices this week, said traders.

April live cattle closed 0.525 cent/lb. lower at 119.425 cents, and June down 0.175 cent to 110.7 cents.

Processors may avoid bidding up for cattle after margins slipped into the red, a trader said. Grocers are not buying large amounts of beef knowing cattle numbers will soon pick up seasonally, he said.

Monday afternoon’s average wholesale beef price was 69 cents/cwt lower than on Friday at $213.43. Select cuts fell $2.65, to $201.35, USDA said.

Last week most market-ready, or cash, cattle in the U.S. Plains fetched $128 to $130/cwt versus $130 to $134.50 in the previous week.

Profit-taking, softer front-month live cattle futures and $1-$3/cwt lower cash feeder cattle prices pulled down CME feeder cattle contracts.

April feeder cattle closed 0.875 cent/lb. lower at 133.075 cents.

— Theopolis Waters reports on livestock markets for Reuters from Chicago.

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