Chicago | Reuters — Chicago Mercantile Exchange lean hogs ended slightly higher on Monday, ending a seven-day losing streak, supported by stronger wholesale pork product prices while cash hog prices weighed, traders said.
April closed just 0.1 cent per pound higher at 62.2 cents, while May ended unchanged at 71.425 cents (all figures US$).
Monday morning’s average market-ready (cash) hog price in Iowa/Minnesota fell 83 cents per hundredweight (cwt) from Friday to $59.06, the U.S. Department of Agriculture said.
Separate USDA data showed the day’s wholesale pork price rose $1.71/cwt to $69.19 from Monday.
U.S. Midwest hog dealers have said there are plenty market-ready hogs available keeping packers from being aggressive buyers.
U.S. Department of Agriculture data also shows pork production for the year as of March 14 up 10 percent compared with the previous year.
“There are a lot of hogs out there according to the kill and the pricing (packers) are paying for them in the cash market,” Domenic Varricchio, commodities broker at Schwieterman, Inc. said.
The backup of product on the West Coast also constrained U.S. pork products for export.
U.S. pork products may also see domestic competition from chicken products if more foreign buyers tighten restrictions on U.S. poultry over bird flu concerns.
Cash weighs on cattle futures
Last week’s soft cash prices combined with light overall trade volume pressured live cattle futures on Monday, traders said.
“Cash trade was not exciting as some were hoping. People were looking for $163, and walked away at $161,” said Varricchio.
“It was a mental defeat. That is primarily the reason I think live cattle are getting pushed down,” he said.
April closed down 1.075 cents/lb. lower at 153.2 cents, and June ended down 0.3 cent at 144.975 cents.
The morning’s choice wholesale beef price edged up 42 cents/cwt from Friday, to $244.54. Select cuts rose $1.01, to $245.08, the USDA said.
CME feeder cattle market followed live cattle futures lower.
“Feeders cannot get up with the back months being down in live cattle. We are seeing some correction in feeder cattle since they did a lot of work to the upside last week,” Varricchio said.
March closed 0.7 cent/lb. lower at 212.425 cents.
— Meredith Davis reports on ag commodity markets for Reuters from Chicago.