Chicago | Reuters — Chicago Mercantile Exchange live cattle futures strengthened on Wednesday as tight U.S. supplies continued to support the market, analysts said.
Feeder cattle futures also advanced, while lean hog futures declined.
The live cattle market is largely trading sideways in the most-active contract this week after finishing with strong gains on Friday, analysts said.
Limited supplies continue to support the market, after producers have sent more cattle to slaughter as drought has reduced the amount of pasture available for grazing.
Read Also
Alberta crop conditions improve: report
Varied precipitation and warm temperatures were generally beneficial for crop development across Alberta during the week ended July 8, according to the latest provincial crop report released July 11.
“You’re still seeing the effects of tighter numbers,” a broker said.
CME August live cattle futures ended 0.875 cent higher at 180.575 cents/lb. (all figures US$). Most-active October live cattle rose 0.8 cent, to 181.7 cents/lb.
September feeder cattle futures rose 1.2 cents to settle at 250.625 cents/lb. A decline in corn prices supported feeders by signaling that livestock feed could become cheaper, analysts said.
In the lean hog market, the nearby August contract dropped 0.45 cent to 101.65 cents/lb. The most-active October contract slid three cents to 81.575 cents/lb.
The U.S. Department of Agriculture quoted the wholesale pork carcass cutout at $109.12/cwt, down $2.97 from Tuesday. Cutout values for bellies dropped $9.79/cwt after large gains in recent weeks.
“Without the belly primal’s support, the cutout would have turned lower nearly a month ago,” brokerage StoneX said in a note.
In China, the world’s biggest pork consumer, an acceleration in pork price declines to 26 per cent from 7.2 per cent drove down the country’s consumer price index. Weak consumption and ample supplies have pressured Chinese pork prices.
Northern China separately warned of crop and animal diseases breaking out as flood waters retreated from rural areas. Farms across Hebei have been severely affected, with numerous pigs drowning in the floodwaters.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.
