Hog markets buoyed by US-China tariff truce – CME

Chicago Mercantile Exchange (CME) live cattle and feeder cattle futures settled near contract highs on Tuesday that were struck during the previous session when a halt to imports of Mexican cattle sent Chicago cattle futures sky-rocketing.

All cattle futures hit lifetime highs on Monday after Washington suspended cattle imports from Mexico over an outbreak of New World screwworm in Mexican cattle, a move that Mexican President Claudia Sheinbaum denounced as unfair.

New World screwworm maggots burrow into open wounds on cattle and other animals, often killing their host within weeks. The suspension of cattle imports from Mexico will further constrain an already-tight US cattle supply.

CME August live cattle futures LCQ25 settled 0.025 cent higher to 211.625 cents per pound. August feeder cattle futures FCQ25 fell 0.375 cent to settle at 306 cents per pound.

Back-month feeder and live cattle futures contracts hit lifetime highs, but technical resistance kept front-month contracts from further rallying.

CME June lean hog futures LHM25 rose 1.2 cents to close at 99.5 cents per pound under continued support from a trade truce between the U.S. and China.

The U.S. and China agreed on Monday to temporarily slash their steep tariffs on each other, helping to propel livestock futures higher as the world’s top two economies tapped the brakes on a trade war that had fed fears of a global recession.

China is a major buyer of U.S. pork products, and the tariff pause created positive market sentiment that the major trade partner will return to buying U.S. pork.

Meanwhile, grilling season has kicked into high gear, and the increased demand for steaks, burgers and other meats have added underlying support to cattle and hog futures.

Tags: Mexico, China, imports, U.S., futures, live cattle, feeder cattle