Chicago | Reuters—Chicago Mercantile Exchange lean hog and live cattle futures closed higher on Tuesday, as market participants appear to be betting that the dockworker strike being short-lived, market analysts and traders said.
U.S. East Coast and Gulf Coast dockworkers began their first large-scale strike in nearly 50 years on Tuesday, halting the flow of about half the country’s ocean shipping, after negotiations for a new labour contract broke down over wages.
Market analysts said that lean hog futures also gained some support from traders growing increasingly uncertainty over the U.S. slaughter pace, market analysts said.
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That, in turn, has traders questioning recent government estimates about the U.S. hog herd size and the supply of market-ready animals, said Dan Norcini, independent livestock trader.
“Based on the USDA data, there should be anywhere from three per cent to five per cent more hogs available for slaughter this year, so our slaughter numbers should be up compared to last year,” Norcini said. “But we’re slaughtering fewer hogs than last year, which has people wondering if there’s a discrepancy in the data.”
Meanwhile, feeder cattle futures turned lower amid pressure on strength in the Chicago Board of Trade corn futures.
Corn futures Cv1 set new 3-month highs on support from wheat futures Wv1, and as oil prices jumped after the Israeli military said on Tuesday that missiles had been launched from Iran at Israel and NATO’s new chief Mark Rutte voiced strong support for Ukraine.
CME December lean hog futures LHZ24 settled up 1.325 cents at 74.600 cents per pound and February hogs LHG25 ended up 1.200 cents at 78.575 cents.
CME live cattle futures closed higher on Monday. Benchmark December live cattle LCZ24 settled up 0.375 cent at 185.175 cents per pound. CME November feeder cattle futures FCX24 fell, settling down 0.225 cent at 244.675 cents per pound.
