Chicago | Reuters – Chicago Mercantile Exchange hogs closed lower for a third straight day on Thursday, posting new lows for the contract, following downward-trending prices for market-ready, or cash hogs and wholesale pork values, traders said.
Plentiful hog supplies and some plants shutting down temporarily to perform routine maintenance, which is typical this time of year, cut cash prices for more than a week, said traders and analysts.
They said retailers were not actively buying pork, given abundant overall meat supplies and a seasonal slowdown in demand until the early-September Labor Day holiday – the last official grilling holiday of the summer.
Uneasiness about trade relations between the United States and China, the No. 2 U.S. pork importer in 2017, kept a lid on deferred hog contracts, a trader said.
“It (China) definitely weighed on the market. But you’ve already priced in the worst case scenario with all of that,” said Hehmeyer Trading + Investments director of commercial agriculture Tom Cawthorne.
August hogs ended down 1.275 cents per pound at 58.975 cents, and hit an all-time low for the contract at 58.050 cents.
October closed 1.125 cents lower at 49.650 cents, and made a new contract low of 50.475 cents.
Live cattle futures end weaker
CME live cattle futures posed modest losses while waiting for the bulk of cash cattle to change hands by late Friday, said traders.
Technical selling and burdensome supply worries further weighed on deferred futures contracts, they said.
“I think the whole thing (market) is very psychological. Everybody keeps saying we’ve got this big wall of cattle coming, so packers are not going to bid up for cattle unless they have to,” said JRS Consulting owner Jack Salzsieder.
Packer bids for slaughter-ready, or cash, cattle in Texas and Nebraska ranged from $109 to $110 per cwt versus $114 to $115 asking prices, said feedlot sources.
A few cattle at Wednesday’s Fed Cattle Exchange, on average, brought $110 per cwt. Last week, cash cattle in the U.S. Plains moved at mostly $112.
August live cattle closed down 0.025 cent per pound at 108.600 cents. October ended 0.325 cent lower at 109.950 cents.
CME feeder cattle tracked softer live cattle futures. August closed 0.625 cent per pound at 151.200 cents.