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U.S. livestock: February hogs fall on high supply, export demand concerns

Cattle futures up but seasonal pressures await

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Published: November 29, 2022

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CME February 2023 lean hogs with Bollinger bands (20,2). (Barchart)

Chicago | Reuters — Lean hog futures on the Chicago Mercantile Exchange eased for a fifth consecutive session on Tuesday, pressured by a combination added seasonal supply and deflated demand as China faces protests over COVID-19 lockdowns.

“This three-week period, we’re pushing a large supply of hogs through the system,” said Rich Nelson, chief strategist at Allendale, Inc. “Typically, this market does like to break on a seasonal basis, through the first week of December.”

Nelson said uncertain export demand to China is adding to normal seasonal pressure.

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The CME February lean hogs contract lost 0.6 cents to 84.15 cents/lb. after falling to 84.025 cents, the contract’s lowest since Oct. 17 (all figures US$).

The nearby December hog contract added 0.475 cents to end at 81.075 cents/lb.

Processors slaughtered 494,000 hogs on Tuesday, up 15,000 from the same week a year ago.

Meanwhile, live cattle futures firmed, supported by tight cattle supplies, though seasonal pressures loom.

“Cattle does have a good story, but it has a seasonal price move in front of it,” said Nelson. “There’s a quick, short term, very severe drop ahead.”

CME benchmark February live cattle gained 0.125 cent, to 154.8 cents/lb. The spot December contract added 0.1 cent, to 152.675 cents/lb.

CME January feeder cattle finished up 1.125 cents at 178 cents/lb.

Boxed beef prices fell on Tuesday, with choice cuts losing $1.18, to $253.35/cwt, while select cuts fell $1.99, to $226.54/cwt.

— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.

About the author

Christopher Walljasper

Christopher Walljasper

Chicago-based Thomson Reuters' reporter covering U.S. food production, supply chain, U.S. hunger and farm labor. Born in a farming community in Southeast Iowa, he graduated from Monmouth College in Illinois and received his master’s degree from the Medill School of Journalism at Northwestern University.

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