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Trade fights continue to batter US lean hog futures

Chicago Mercantile Exchange (CME) live cattle and lean hog futures fell for a second trading day on Monday (3 June).

4 June 2019, at 10:19am

Chicago Board of Trade corn futures ended Monday (3 June) on a negative note, amid uncertainty over US corn planting progress and the ongoing threat of US tariffs against Mexico, a top corn buyer, reports Reuters.

Still, trade fears weighed heavily on the livestock futures market overall. The market continued to wrestle with whether Mexico will retaliate against President Donald Trump's threats to levy duties on all Mexican imports unless it curbs illegal immigration, adding to global growth worries. Mexico is the biggest importer of US pork and the third biggest importer of US beef.

Meanwhile, the trade war between the United States and China shows little sign of easing any time soon, "so the hopes that China would be buying beef from us have been pushed to the back burner," said Don Roose, president of US Commodities in West Des Moines, Iowa.

Roose said funds liquidating their long positions has weighed heavily on livestock futures prices. So too has the fact that US supplies of both hogs and cattle are outstripping demand.

"It's never a friendly signal to see cash prices lower on Monday or Tuesday than they were the week before," French said. "Most people anticipate that if you're at $113 on Monday, you'll be trading in the $110s by Friday."

CME June lean hogs closed down 0.15 cent at 81.575 cents per pound while most actively traded July hogs ended down 1.4 cents at 84.525 cents.