U.S. livestock: CME hogs see biggest one-day loss in three months

Chicago | Reuters — Chicago Mercantile Exchange lean hog futures on Monday notched their biggest daily loss since last December, hit by technical selling and lower cash price expectations, traders said.

April closed 2.1 cents/lb. lower at 69.35 cents, after drifting below the 40-day moving average of 70.31 cents (all figures US$). May ended 2.1 cents/lb. lower at 77.675 cents, and beneath the 20-day moving average of 77.95 cents.

Cash hogs in the U.S. Midwest on Monday morning traded as much as $1.50/cwt lower, pressured by scheduled plant closures on Good Friday and Easter Monday, regional hog dealers said.

Monday morning’s cash prices were further pressured by at least one packing plant in the eastern corn belt down for equipment upgrades, another dealer said.

Investors exercised caution before USDA’s quarterly hog report, due to be issued on Good Friday.

USDA will release the monthly cold storage report on Tuesday at 2 p.m. CT that will include February pork and beef inventories.

A few analysts, on average, estimated last month’s cold storage total pork stocks at 683.5 million lbs., and beef at 509.3 million lbs.

Lower live cattle close

Sell stops and fund liquidation sent CME live cattle futures lower for a third consecutive session, traders said.

April live cattle ended 1.475 cents/lb. lower at 138.35, and June finished 1.25 cents lower at 127.85.

Selling was encouraged by Friday’s wholesale beef price decline, while buying was subdued with packers needing fewer cattle over the holiday weekend.

“There’s some technical weakness there and the beef market was alright today, but it was down on Friday as well. I would’ve thought the cash trade would have been more supportive to the market,” said Brock Associates Inc. analyst Doug Houghton.

The morning’s wholesale choice beef price dropped 62 cents/cwt from Friday, to $231.19. Select cuts rose 87 cents, to $223.20, USDA said.

Last week, the bulk of market-ready, or cash, cattle in the U.S. Plains moved at $139/cwt, $1 higher than the week before, said feedlot sources.

Cash prices were better, but short of what some people had expected given future’s rally early last week, a trader said.

CME feeder cattle futures lost ground for a third day in a row, pressured by the slumping live cattle market and lower cash feeder cattle prices. March closed 0.85 cent/lb. lower at 162.375 cents.

Theopolis Waters reports on livestock markets for Reuters from Chicago.

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