Chicago | Reuters — Nearby U.S. hog and live cattle futures weakened on Wednesday, weighed down by prospects for rising feed costs due to higher prices for corn, soybeans and wheat.
But the livestock futures market was strong for many deferred contracts as traders expressed concerns about supplies tightening by the end of the year.
Weakness in the cash market added pressure to nearby futures contracts.
Chicago Mercantile Exchange (CME) February lean hogs dropped 1.65 cents to 66.85 cents/lb. (all figures US$). April and May hog contracts also were lower while contracts from June onward rose.
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U.S. corn futures hit a two-week low on Monday and soybeans also fell as market players continued to brace for large crops and forecasts called for milder, non-threatening weather in the Midwest production belt.
The most-active February contract dropped below its 20-, 30-, 40- and 50-day moving averages during the session.
Estimated pork packer margins fell to $37.30 from $45.70 per head on Tuesday, according to livestock marketing advisory service HedgersEdge.com.
February live cattle futures ended 0.225 cent lower at 112.25 cents/lb. Deferred contracts ranged from 0.3 cent lower to 1.025 cents higher.
March feeder cattle rose 0.65 cent to 134.625 cents, with some bargain buying noted after falling to its lowest since Nov. 20 on Tuesday.
— Reporting for Reuters by Mark Weinraub in Chicago.
