Chicago | Reuters — Chicago Mercantile Exchange lean hog futures climbed on Tuesday, supported by persistent tight supplies of market-ready hogs, analysts said.
“We know numbers are getting tighter. We haven’t generated the expansion we needed to over the last six to nine months,” said Matthew Wiegand, Risk Management Consultant at FuturesOne. “The numbers are going to stay tighter than usual, going into summer and the big demand season.”
April lean hog futures added 1.825 cents, to 104.15 cents/lb. (all figures US$).
Cash prices climbed, with the CME’s Lean Hog Index, a two-day weighted average of cash hog prices, adding $1.59, to $90.51/cwt, its highest since Oct. 11, 2021.
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Higher cash failed to deter processors, with hog slaughter firming to 478,000 head, up 6,000 from the same day a week ago and up 16.87 per cent from the same day a year ago, the USDA said.
Live and feeder cattle also firmed on tighter supplies, though Wiegand said a lack of new supportive fundamentals could push live cattle sideways in the near term.
April live cattle firmed 0.55 cents, to 146.9 cents/lb. March feeder cattle added 1.85 cents, to 168.725 cents/lb., boosted by lower Chicago Board of Trade corn futures.
“We are still a bit overbought, and that opens the door for some back and forth correction,” said Wiegand.
Cattle slaughter continued to firm, with an estimated 123,000 head processed, up 1,000 from a week ago and 33.7 per cent higher than a year ago, USDA said.
Choice cuts of boxed beef continued lower, losing $2.63, to $271.33/cwt, while select cuts added $1.14, to $269.89/cwt, USDA said.
— Reporting for Reuters by Christopher Walljasper in Chicago.
