Chicago | Reuters — Chicago Mercantile Exchange lean hogs settled higher on Wednesday, with support from fund buying and short-covering before the U.S. Thanksgiving Day holiday, traders said.
CME livestock markets will be closed for Thursday’s holiday, but resume on Friday at 8:30 a.m. CT and close early at 12:15 p.m. CT.
December hogs ended 2.125 cents/lb. higher at 62.825 cents and above the 200-day moving average of 61.947 cents (all figures US$). February closed 2.15 cents higher at 69.1 cents, above the 40-day moving average of 68.643 cents.
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Futures made headway without fundamental support, although there was talk that some packers might need hogs for the first full week of production after the holiday.
A few grocers may also step up near-term pork purchases to avoid possible shortages after packing plants shutdown for the holiday.
On Wednesday the U.S. Department of Agriculture’s (USDA) monthly cold storage report showed October pork inventory totaled 597.3 million lbs. That eclipsed analsyts’ average forecast of 595.1 million lbs.
Cattle markets extend gains
CME live cattle futures gained for a second day in a row on short-covering and improved cash prices, said traders.
Short-covering and fund buying contributed to Wednesday’s market advances, they said.
December live cattle finished up 1.075 cents/lb. at 119.050 cents, and February ended 1.425 cents higher at 125.475 cents.
Late on Tuesday, packers in Nebraska paid mostly $120/cwt for slaughter-ready, or cash, cattle that were steady to up $1 compared to a week ago there, USDA said. Tuesday morning’s Texas and Kansas cash trade brought $118, $1 lower than a week ago in both states.
“The numbers I’m seeing so far suggest packers haven’t secured enough animals this week. So it’s kind of given the feedlots the upper hand, depending on the region you’re looking at,” Top Third Ag Marketing broker Jeff French said.
Some processors avoided paying more for cattle after filling inventories and closing plants for the holiday. Others competed for supplies while taking advantage of their margins that have come down in recent weeks, but remain historically high.
Wednesday’s USDA cold storage report showed total beef stocks last month at 506.9 million lbs., well above analysts’ average forecast of 489.4 million lbs.
Buy stops, short-covering and live cattle futures buying lifted CME live cattle contracts for a second straight session.
January feeder cattle closed up 1.1 cents/lb. at 152.725 cents.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.
