Chicago | Reuters — Chicago Mercantile Exchange hog futures plunged four per cent on Monday, hitting their lowest level in nearly a month, as robust supplies threatened profits even as pork prices edged off their recent lows, traders said.
Pork processors earned $22.90 per hog, down from $46.25 per hog on Friday and $43.20 a week ago, according to livestock marketing advisory service HedgersEdge (all figures US$).
“Big production plays a role in all of that, with last week’s slaughter total of 2.667 million head our largest yet of the season and a couple more big weeks just ahead of us,” brokerage StoneX said in a note to clients.
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For the week ending August 2, Western Canadian feeder cattle markets traded steady to as much as $10 higher. Quality yearling packages off grass were up as much as $15 in some cases. Prices for similar weight cattle were quite variable across the Prairies, which made the market hard to define. The market appears to be in price discovery mode for the grass yearling market.
CME February lean hogs settled 3.275 cents lower at 78.225 cents/lb. The contract hit its lowest price since Nov. 10.
In the U.S. pork market, the wholesale carcass cutout price added $7.93 to close at $89.30 per hundredweight (cwt), rebounding from the 10-month low hit on Friday, the U.S. Agriculture Department said. Ham prices gained $5.55, to $67.82/cwt, while belly prices rose by $23.48, to $150.78/cwt.
CME February live cattle finished 0.7 cent higher at 139.65 cents/lb. CME January feeder cattle rose 1.125 cents to end at 165.25 cents/lb.
Profit margins for beef processors on Monday fell to $252.25 per head of cattle from $254.35 on Friday and $362.60 a week ago, HedgersEdge said.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.
