Chicago | Reuters — U.S. hog and live cattle futures eased on Friday, with end-of-week profit-taking and technical selling pressuring the livestock markets, traders said.
Strong consumer demand for pork underpinned the hog futures, which rose 17.4 per cent this week.
“The pork product markets continue to scream higher and have begun to pull lean hog futures alongside,” INTL FCStone said in a note to clients.
Lean hog futures for June delivery dipped 0.1 cent to 51.525 cents/lb. at the Chicago Mercantile Exchange (all figures US$). The contract hit its highest since April 8 before closing off its highs.
Smithfield Foods said Friday it will suspend operations at its Monmouth, Illinois pork processing facility next week after some employees tested positive for COVID-19. The plant represents about three per cent of U.S. fresh pork supplies.
CME June live cattle fell 0.3 cent to 82.625 cents/lb. The contract firmed early in the session but turned lower after hitting resistance at its five-day moving average.
August feeder cattle futures rose 0.25 cent to 126.4 cents/lb.
After the close, the U.S. Agriculture Department said that the amount of cattle in U.S. feedlots as of April 1 was 95 per cent of the year-earlier total. That matched market forecasts.
The amount of cattle marketed during March was 113 per cent of the March 2019 total, topping market estimates for 111.8 per cent. But monthly placements were 23 per cent lower than March 2019. Analysts had been expecting placements to fall 21 per cent.
The monthly report will be seen as bullish to the market, reflecting good demand even though the supply chain is strained due to the coronavirus pandemic, said Josh Steinhilber, a broker at Cattlehedging.com.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.