Chicago | Reuters — U.S. live cattle futures on Monday reached a two-month high on follow-through buying from last week, while lean hog futures edged up on bargain buying, traders said.
Cattle futures are extending a recovery after recently regaining a premium over cash prices, traders said. Technical buying helped support the futures market even though the supply of cattle remains ample, they said.
Pig supplies are also abundant, which should limit a rebound in lean hog futures after that market fell to contract lows last week, traders said.
“We’re just hovering off these contract lows, so there’s some bargain buying coming in,” said Brian Hoops, president of U.S. brokerage Midwest Market Solutions.
Chicago Mercantile Exchange live cattle settled up 0.7 cents at 100.1 cents/lb. and reached its highest price since May 13 (all figures US$). CME August feeder cattle jumped 1.275 cents to 136.15 cents/lb. and set its highest price since June 1.
CME August lean hogs ended up 0.075 cent at 49.275 cents/lb., after setting a contract low of 47.525 cents last week. October hogs closed 0.7 cent higher at 49.05 cents/lb.
Pigs backed up on farms after slaughterhouses closed temporarily in April and May as meatpacking workers fell sick with the new coronavirus. Plants have since reopened and slaughterhouses are working through excess supplies of livestock.
The U.S. Department of Agriculture, in newly released data, said U.S. pork exports to China in May reached 108,869 tonnes, up from 34,427 tonnes a year earlier. It was the second highest month for U.S. exports to China ever, after April 2020.
China suspended imports from two Brazilian pork plants owned by meatpackers JBS and BRF, according to the Chinese customs authority, as it cracks down on meat shipments amid concerns about the new coronavirus.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.