Chicago | Reuters –– Chicago Mercantile Exchange lean hog futures eased on Monday as the U.S. Agriculture Department lifted its forecast for domestic pork production and lowered its price outlook for pigs for this year.
The department, in a monthly report, raised its estimate for pork production in the third quarter by 0.9 per cent from August because the pace of slaughtering has exceeded expectations. The agency lowered its 2022 hog price forecast 3.4 per cent from last month to $71.30 per hundredweight based on observed prices.
“We’re seeing lighter weights but higher quantity,” the department said in a webcast after issuing the report.
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CME October lean hogs closed 1.3 cents lower at 91.875 cents/lb., while December hogs slid 0.35 cent to end at 82.775 cents/lb. (all figures US$).
Meat processors slaughtered about 483,000 hogs on Monday, up from 470,000 hogs a year earlier, according to daily U.S. government data.
Beef production is also projected to exceed previous expectations in 2022 and 2023 due to higher slaughtering, the agriculture department said in its monthly report. Cattle ranchers are sending more animals to feedlots to be fattened for slaughter as a U.S. drought has scorched pastures used for grazing.
The department, in its monthly report, slightly raised its price outlook for steers in 2022 to $142.80 per hundredweight from $142.10 last month.
At the CME, October live cattle rose 0.075 cent to 145.75 cents/lb., and December gained 0.375 cent to close at 151.35 cents/lb.
Feeder cattle futures, meanwhile, came under pressure from rising prices for corn used for livestock feed, traders said. October feeders sank 2.45 cents to close at 183.125 cents/lb. and touched their lowest price in more than two weeks.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.
