CME cattle, lean hog futures firm
Concerns about the economy easing
12 August 2024
2 minute read
By: Chicago Mercantile Exchange (CME) livestock futures turned higher on Friday, as cattle futures rebounded from recent sharp drops in pricing amid a flurry of fund selling, reported Reuters.
CME lean hog futures also ended higher on technical trading, though traders and market analysts alike said they are keeping a close eye on bearish cues in the cash market and as US wholesale pork carcass prices have fallen this week.
CME October lean hog futures ended up 0.350 cent at 73.975 cents per pound.
CME most-active October feeders closed up 4.125 cents at 246.500 cents per pound. Most-active October live cattle finished 3.125 cents higher at 181.150 cents per pound.
News that the number of Americans filing new applications for unemployment benefits fell more than expected last week helped ease concerns that the labor market was unraveling, said Rich Nelson, chief strategist at Allendale, Inc.
That, in turn, helped reinforce the idea that a gradual economic softening remains intact, and that consumer demand for meat - particularly pricier beef - wouldn't suddenly plummet, traders said.
Initial claims for state unemployment benefits fell 17,000 to a seasonally adjusted 233,000 for the week ended Aug. 3, the Labor Department said on Thursday, the largest drop in about 11 months.
"The jobless claims just were not that bad, so what we saw in the cattle markets today was a reasonable rebound," Nelson said.
Continued weakness in the Chicago corn futures market also gave cattle some support on the day, as both cattle and hog futures recovered from sharp declines earlier this month, analysts said.
Still, livestock traders said they remain cautious about the risk for further setbacks linked to economic concerns, and as weekly beef sales slipped to a four-week low on declining global beef demand.
