Chicago | Reuters — U.S. lean hog futures rose 3.8 per cent on Monday, notching their biggest daily gain since September, in a technical bounce from the three-week low they hit on Friday, traders said.
“We hit the bottom end of the range so we are just bouncing back,” said Don Roose, president of brokerage U.S. Commodities.
Chicago Mercantile Exchange (CME) February lean hogs rose 2.45 cents to 65.675 cents/lb. (all figures US$).
The contract found support at the low end of its 20-day Bollinger range before rallying above its 100-day moving average.
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As the harvest in southern Alberta presses on, a broker said that is one of the factors pulling feed prices lower in the region. Darcy Haley, vice-president of Ag Value Brokers in Lethbridge, added that lower cattle numbers in feedlots, plentiful amounts of grass for cattle to graze and a lacklustre export market also weighed on feed prices.
Cattle futures ended close to unchanged, with live cattle closing slightly lower after rising for three days in a row. Feeder cattle futures edged higher.
February live cattle futures ended 0.15 cent lower at 113.1 cents/lb. January feeder cattle gained 0.225 cent, to 139.95 cents/lb.
Traders were watching for signs of a stabilizing cash market after prices dropped last week.
“The holiday buying is basically done so that is why we belly-flopped,” Roose said. “We have to recharge our demand at a lower price.”
The choice boxed beef cutout fell $1.19, to $212.69/cwt, on Monday, while select cuts dropped $3.45, to $192.26/cwt, according to the U.S. Department of Agriculture (USDA).
The select cuts were at their lowest since Oct. 30 while the choice cutout figure was the lowest since Nov. 5.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.
