Lean hog futures hit five-month low - CME
August cattle futures close down
6 June 2024
2 minute read
By: Lean hog futures closed at their lowest price since January at the Chicago Mercantile Exchange (CME) on Wednesday as traders focused on a potential oversupply of US pork heading into the summer barbecue season, reported Reuters.
US pork production is projected to increase in 2024, while beef production is forecast to drop after ranchers reduced their herds, according to the US Department of Agriculture.
"The trade is nervous about supply outstripping demand as we start summer grilling," said Mike Zuzolo, president of Global Commodity Analytics. "Pork doesn't have what beef has, which is tight supplies."
Farmers are raising heavier hogs as feed costs have declined. The weekly estimated average hog weight for the week ending on Saturday was 290.4 pounds, up from 283.8 pounds from the same period in the previous year, according to USDA data.
A strengthening dollar, which usually makes US goods less desirable, also added to concerns over the export market for US pork.
CME July hog futures ended down 1.725 cents at 92.2 cents per pound.
US meatpackers slaughtered an estimated 482,000 hogs, down from 483,000 a week ago but up from 459,455 a year ago, according to the US Department of Agriculture. They processed an estimated 124,000 cattle, compared to 125,000 cattle a week ago and 124,324 cattle a year earlier.
Live cattle and feeder cattle futures weakened slightly as USDA data showed that wholesale boxed beef prices for choice cuts and select cuts sank.
CME August live cattle closed down 0.575 cent at 177.875 cents per pound.
CME August feeder cattle settled down 1.2 cent at 254.825 cents per pound.
