U.S. livestock: Hog futures rally on technical buying

CME cattle futures lower

CME February 2021 lean hogs with 20-, 30-, 40- and 100-day moving averages. (Barchart)

Chicago | Reuters — U.S. lean hog futures rose slightly on Tuesday on follow-through buying from a rally on Monday, traders said.

Cattle futures eased, pressured by recent weakness in the cash markets as well as some technical sales.

Chicago Mercantile Exchange (CME) February lean hogs rose 0.775 cent to settle at 66.45 cents/lb. (all figures US$). The contract rose above its 100-day moving average but struggled to hold support above its 20-day, 30-day and 40-day moving averages.

February live cattle futures dropped 0.225 cent to 112.875 cents/lb. The contract closed above its session lows after finding support at its 20-day moving average.

January feeder cattle fell 0.125 cent to 139.9 cents/lb.

The choice boxed beef cutout fell 59 cents to $209.10/cwt on Tuesday morning, according to the U.S. Department of Agriculture (USDA). Select cuts gained two cents to $192.32/cwt, edging off the 1-1/2-month low hit on Monday.

China’s pig and sow herds, ravaged by African swine fever over the past two years, recovered to more than 90 per cent of normal levels by the end of November, the official news agency Xinhua said on Tuesday. Production capacity should fully recover by the first half of next year, said Xinhua, citing the ministry of agriculture and rural affairs.

Analysts were expecting a U.S. Agriculture Department report on Friday to show that the amount of cattle placed on feed during November was down 8.6 per cent from a year earlier. There were 12.031 million head of cattle on feed as of Dec. 1, analysts said, in line with the herd on Dec. 1, 2019.

— Mark Weinraub is a Reuters commodities correspondent in Chicago.

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