Chicago | Reuters — Chicago Mercantile Exchange lean hog futures surged over four per cent on Tuesday, rising to the highest levels in three months on support from gains in prices for hogs in cash markets and wholesale pork, traders said.
A lower U.S. hog slaughter in recent days due to Hurricane Florence limited pork production, buoying pork prices. Slaughter plants in North Carolina, the No. 2 hog state after Iowa, have been largely shut down since last week as the storm caused widespread flooding.
“The disruption in hog slaughter has not stopped,” said Linn Group analyst John Ginzel. “You have tightened up the availability and you have some end-users scrambling to buy.”
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The U.S. Department of Agriculture estimated Tuesday’s hog slaughter at 422,000 head, down from 469,000 hogs a week ago.
However, hog supplies still are ample and prices could ease if animals begin to back up, traders said.
CME October hog futures finished 2.725 cents higher at 59.175 cents/lb. and most-active December hogs were up 2.6 cents at 57.975 cents (all figures US$).
Cash hogs in the top market of Iowa and Minnesota climbed $1.96, to $53.79/cwt, while wholesale pork prices were up $1.55, to $77.57/cwt, highest since July, USDA data showed.
Futures for live and feeder cattle were narrowly lower, hovering just below recent multi-month peaks reached on Monday.
Traders were squaring up positions ahead of a monthly USDA Cattle on Feed report due on Friday. Analysts polled by Reuters expected the government to show about four per cent more cattle placed in feedlots for fattening during August.
CME October live cattle futures settled down 0.2 cent, at 113.225 cents/lb.; CME October feeder cattle were down 1.15 cents, at 158.025 cents.
— Michael Hirtzer reports on commodity markets for Reuters from Chicago.
