Chicago | Reuters — U.S. hog futures rallied on Thursday, with most contracts closing at their daily trading limit, on hopes that exports to China will pick up after Washington and Beijing agreed to open trade negotiations, traders said.
China and the U.S. will hold lower-level trade talks this month, the two governments said, offering hope that they might resolve an escalating tariff war that includes U.S. shipments of pork to China.
“It’s speculation that exports are going to get better and rescue this market,” said Altin Kalo, analyst at Steiner Consulting Group. “The tariffs are so prohibitive that it makes it difficult to move pork over there.”
Read Also
USDA adjusts supply/demand estimates
Corn and soybean yields in the United States were left unchanged in the latest supply/demand estimates from the U.S. Department of Agriculture, released July 11, although a reduction in harvested area led to small downward revisions to production for the crops.
Additionally, concerns about swine fever boosting Chinese demand even further lent support to the market. China found its second case of African swine fever on Thursday at a slaughterhouse owned by WH Group’s Chinese unit, stirring concerns about the spread of the deadly infection across the world’s largest pig herd.
Most active CME October hogs settled up three cents to 55.475 cents/lb. (all figures US$). The limit-up move pushed prices for the contract to a three-week high.
Cattle futures were steady to firm.
CME August live cattle futures ended unchanged at 108.325 cents/lb. The most active October live cattle contract was up 0.275 cent at 109.275 cents.
CME August feeder cattle futures rose 1.25 cents, to 150.3 cents/lb., and September feeders were 1.1 cent higher at 150.25 cents.
— Mark Weinraub is a Reuters commodities correspondent in Chicago; additional reporting by Michael Hirtzer.
