Chicago | Reuters — Chicago Mercantile Exchange live cattle futures closed lower on Wednesday for a second straight session as worries eased about a blizzard disrupting feedlots in the U.S. Plains, traders said.
“The storm system for the most part moved further to the north — more to South Dakota, and missed a lot of key areas in Nebraska,” said Don Roose, president of Iowa-based U.S. Commodities.
The slow-moving storm is set to bring heavy, wet snow, with the heaviest accumulations in western Minnesota and southeast South Dakota.
Lacklustre cash cattle trade added to bearish sentiment. Cash cattle sold in Texas and Kansas at $124 per hundredweight, about steady with last week, traders said (all figures US$).
“Bigger numbers (of cattle) are going to come at us … and it feels like we have a seasonal top in the cash,” Roose said.
Benchmark CME June live cattle futures fell 0.4 cent to close at 119.95 cents/lb. while front-month April settled down 0.025 cent at 125.875 cents.
April feeder cattle futures settled down 0.975 cent at 145.175 cents/lb. and May feeders fell 0.950 cent at 149.225.
Lean hog futures closed higher, bouncing back from limit declines the previous session as news that African swine fever emerged in South Africa sparked a fresh round of buying.
The incurable hog disease has spread across China since last year, causing major losses to the world’s largest hog herd and raising expectations of a pick-up in U.S. pork exports.
“The big news was the swine fever announced in South Africa,” said Jeff French, analyst with Top Third Ag Marketing. “It jumped a continent,” he said.
However, traders also noted that the U.S. pork industry on Wednesday canceled its annual June convention, the World Pork Expo, over concerns that international attendees could bring in the disease.
“If you are a hog producer, you have to have puts in place, in case the swine fever is found in North America,” French said, adding that if the disease ever reached the U.S., “We would just be limit-down for a while because immediately, all of our trading partners would stop buying our pork.”
Most-active CME June lean hog futures settled up 1.3 cents on Wednesday at 96.45 cents/lb. while front-month April hogs ended up 0.375 cent at 78.9 cents/lb.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.