Chicago | Reuters — Chicago Mercantile Exchange lean hog futures firmed on Tuesday, marking the contract’s fifth gain in six days, pushed higher by increased demand for pork as restaurants reopen, while supplies remain low.
“You have some supply-side influence on why the market is this good,” said Brad Kooima, commodity broker at Kooima Kooima Varilek Trading Inc. “There’s less pig supply.”
Culling during height of the COVID-19 pandemic cut supplies, while a disease known as porcine reproductive and respiratory syndrome (PRRS) has led to farrowing problems, said Kooima, leaving some hog farmers with empty barns, waiting weeks for new pigs.
CME April lean hogs closed 1.425 cents higher at 96.475 cents/lb., after notching a life-of-contract high at 96.625 cents, while the most-active June contract added 1.775 cents, to 101.25 cents/lb. (all figures US$).
Daily hog slaughter slipped to 476,000 head, down 3.4 per cent from a week ago and 4.6 per cent lower than a year ago.
Meanwhile, CME live cattle futures firmed as slaughter weights fall back to pre-pandemic levels and demand improves, though elevated feed costs remain a concern for producers.
Choice and select beef cuts have risen for the last five sessions, with choice climbing $3.04, to $233.99/cwt, on Tuesday, while select cuts added $2.18, to $225.23/cwt, according to the U.S. Department of Agriculture.
CME April live cattle gained 0.35 cent, settling at 119.125 cents/lb., while actively traded June futures added 1.125 cents, to 120.05 cents. May feeder cattle ended 0.375 cent higher at 145.475 cents/lb.
“With the cost of (feed) ration going up significantly, I think guys have made a concerted effort to sell cattle on a more timely basis,” said Kooima.
Daily cattle slaughter fell to 117,000 head, down 3.3 per cent from a week prior, and 6.4 per cent less than the same time a year ago.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.