Hog, cattle markets overbought and due for corrections - CME
Lean hogs touch one-week lows in pullback from gains
28 October 2022
2 minute read
By: Chicago Mercantile Exchange (CME) lean hog futures fell to their lowest prices in more than a week on Thursday in a setback from recent rallies, Reuters reported, citing traders as its source.
Live cattle futures also ended lower after the February contract LCF3set a new high.
The hog and cattle markets were overbought and due for corrections, traders said.
December lean hog futures sank 3.375 cents to close at 85.125 cents per lb and touched their lowest price since October 18 at 84.675 cents per lb. February hogs slid 2.850 cents to close at 88.150 cents per lb and hit their lowest price since October 19 at 87.775 cents.
An increase in pork inventories in cold storage is acting as an anchor for the hog market, a broker said.
The US Department of Agriculture on Monday reported total pork supplies in cold-storage facilities at the end of September were up 14% from a year earlier. Total supplies of frozen beef were 19% higher.
In the beef market, December s 0.150 cent lower at 153.425 cents per lb. The contract has climbed more than 5% since hitting a 10-week low on September 29. February live cattle closed down 0.175 cent at 156.850 cents after touching a contract high of 157.225 cents.
Gains in the cattle market have encouraged more short hedging by producers, broker StoneX said in a note.
"We have seen an uptick in new selling across our desk and the industry," StoneX said.
CME November feeder cattle ended 0.700 cent lower at 178.125 cents per lb, and January feeders FCF3 slipped 0.800 cent to 180.450 cents per lb.
Choice cuts of boxed beef fell by $1.63 to $262.49 per cwt, while select cuts jumped by $3.31 to $231.91 per cwt, according to the USDA.
