Chicago | Reuters — U.S. lean hog futures fell on Wednesday for the third day in a row, hitting new contract lows on worries that mounting trade tensions with key overseas buyers will cause supplies to rise, traders said.
“Tariff concerns remain and there are fears that we are going to back pork up into the domestic market,” said Don Roose, president of Iowa-based brokerage U.S. Commodities.
Live cattle futures closed firmed on a round of short-covering. The front-month contract hit its highest since June 29.
Traders said expectations for higher cash prices fueled the bounce in cattle futures as packers were expected to increase their buying to make up for shortfalls in cash deals last week.
Most active CME October hogs settled down 0.275 cent at 51.925 cents/lb. while August hogs fell 0.7 cent to 67.2 cents, closing just above its contract low of 67.1 cents (all figures US$).
CME August live cattle closed Wednesday up 2.525 cents at 108.95 cents/lb. CME October live cattle rose 2.15 cents to 110.65 cents.
CME August feeder cattle futures settled up 3.275 cents at 154.55 cents/lb. and September feeders rose 3.15 cents, to 154.85 cents.
Livestock traders are awaiting direction from two big U.S. Department of Agriculture reports due Friday, including the government’s monthly Cattle on Feed report and its semiannual cattle inventory report.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.