Chicago | Reuters — Chicago Mercantile Exchange lean hog futures were mostly higher on Tuesday on lofty pork prices, tightening hog supplies and hopes for improved meat demand as economies begin to fully re-open after coronavirus pandemic shutdowns.
Hog supplies have tightened following liquidation of the U.S. sow herd last year and some disease-related U.S. hog herd losses.
Pork exports are also a bright spot as top consumer China struggles with rising cases of African swine fever, which decimated the country’s hog herd in recent years.
“There are a lot of empty barns in the big hog states and, coming out of the pandemic, the food industry is restocking,” said Don Roose, president of U.S. Commodities.
The wholesale pork cutout price eased on Tuesday afternoon after peaking on Monday at its highest since last May, according to U.S. Department of Agriculture (USDA) data.
CME April lean hog futures gained 2.35 cents to settle at 92.9 cents/lb. (all figures US$). Actively traded June futures jumped 2.05 cents, to 100.975 cents.
CME live cattle futures ended mixed, with nearby contracts easing as futures remain at a sizable premium to cash market prices.
Cattle, however, remain underpinned by hopes for improving beef demand as restaurants reopen following pandemic shutdowns and as warmer weather ushers in the outdoor grilling season.
CME April live cattle fell 0.925 cent to 118.2 cents/lb., while June futures shed 0.325 cent, to 121.45 cents.
April feeder cattle settled down 0.6 cent at 143.325 cents/lb., pulling back from a two-week high posted in the previous session.
Traders are looking ahead to Friday’s monthly USDA Cattle on Feed report. Analysts expect higher on-feed supplies as of March 1, while placements and marketings were seen declining from a year ago.
— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago.