Hog futures jump to 4-week high; cattle futures rise
Beef and pork stocks larger than expected, say analysts
23 December 2021
2 minute read
Chicago Mercantile Exchange hog futures jumped to their highest prices in about four weeks on Wednesday, while cattle futures also advanced, reported Reuters.
Futures could come under pressure early on Thursday from monthly US Department of Agriculture (USDA) data that showed frozen pork supplies on 30 November were down 8% from the previous month and down 3% from last year, said Rich Nelson, chief strategist at Allendale.
Pork supplies typically tighten in November and last month's reduction was on the lower end of typical declines, Nelson said.
Frozen beef inventories on 30 November were up 4% from the previous month but down 4% from last year, the USDA said in its cold storage report.
"I'd call beef and pork stocks larger than we expected," Nelson said.
CME February lean hog futures settled up 0.925 cents at 83.350 cents per pound, and set their highest price since Nov. 26 at 83.600 cents.
Traders are waiting for the USDA's quarterly Hogs and Pigs report on Thursday that is expected to show the nation's herd was about 2.9% smaller on 1 December from a year earlier, a Reuters survey of analysts showed.
The agency on Thursday will also issue a monthly report that is expected to show the United States on 1 December had about the same number of cattle on feed for slaughter as a year earlier, according to another Reuters survey. Analysts estimated cattle placements and marketings in November were up from a year ago.
CME February live cattle settled up 0.450 cents at 137.375 cents per pound. CME March feeder cattle closed 0.100 cents higher at 161.925 cents.
In demand news, South Korea could increase purchases of US beef over the next few weeks after suspending imports of Canadian beef due to a bovine spongiform encephalopathy (BSE) case in Canada, Nelson said.
Source: Reuters
