Chicago/Reuters – Chicago Mercantile Exchange lean hogs finished higher on Thursday, with strength from bargain buying prior to what turned out to be a neutral U.S. government hog report after futures closed, said traders.
The U.S. Department of Agriculture’s quarterly hog report showed a record-large March 1 herd, with most of the data close to forecasts.
Buy stops and technical buying furthered market gains, said traders and analysts.
April hogs ended up 0.325 cent per pound to 65.625 cents, and above the 200-day moving average of 65.479 cents. May finished 1.025 cents higher at 70.500 cents.
“Analysts did such a good job of anticipating the numbers in this report, I do not see much in the way of impact,” said CME livestock futures trader Dan Norcini.
He said investors will mainly focus on cash prices and signs of retailers pork buying for spring and summer grilling.
Thursday afternoon’s average price for slaughter-ready, or cash, hogs in Iowa/Minnesota was $63.20 per cwt, down 93 cents from Wednesday, the USDA said.
Government data showed the average U.S. wholesale pork price fell $1.04 per cwt from Wednesday to $75.18, mainly due to $3.30 lower pork butt or pork shoulder cuts.
Cattle futures turn lower
CME live cattle futures reversed some of Wednesday’s gains, following tepid wholesale beef demand that threatens remaining cash prices, said traders.
They said sell stops and fund liquidation exacerbated futures losses.
April live cattle closed 1.350 cents per pound lower at 120.000 cents, and June ended 0.975 cent lower at 110.875 cents.
Both contracts settled below their respective 10-day moving average of 120.765 and 111.572 cents. Thursday afternoon’s average wholesale beef price fell $1.71 per cwt lower from Wednesday at $215.21. Select cuts sank $2.21 to $208.05, the USDA said.
Cash cattle bids in the U.S. Plains ranged from $126 to $128 per cwt against $132-plus asking prices. Cash cattle last week in the U.S. Plains brought mostly $130 to $134.50. Wednesday’s Fed Cattle Exchange resulted in $131.17 per cwt average prices, down from last week’s $133.35 average.
Tighter packer profits and seasonal beef demand slowdown are expected to pressure remaining cash prices, said traders and analysts. Profit-taking, technical selling and lower live cattle futures sank CME feeder cattle.
March feeder cattle , which expired at noon CDT (1700 GMT), ended down 0.625 cent per pound to 132.675 cents.
Most actively traded April closed 1.850 cents lower at 132.550 cents.