Lean hog futures hit contract high – CME
Chicago Mercantile Exchange (CME) live and feeder cattle futures rose on Wednesday as a strong cash market and a screwworm outbreak in Mexican cattle added support to futures.
Lean hog futures tipped down on weakening pork prices and profit taking following five straight days of increases, and ahead of the market’s US Thanksgiving Day closure on Thursday.
A case of New World screwworm detected late last week has caused the US to halt imports of Mexican cattle, further constraining an already tight cattle supply.
CME January feeder cattle settled up 0.675 cent at 258.775 cents per pound, after hitting its highest point since July 8. February live cattle futures gained 0.900 cent to settle at 188.600 cents per pound.
In a press conference, Mexican President Claudia Sheinbaum said she hopes the matter will be resolved this week, though analysts said they believe the border will be closed to Mexican cattle imports for multiple weeks.
On Tuesday, the New York-based Wildlife Conservation Society said evidence linked the resurgence of the screwworm – which often enters through open wounds and eats living flesh – to illegal cattle trafficking across Central America.
Meanwhile, rain in the US Plains has improved pasture conditions and increased demand for feeder cattle from producers eager to get cattle grazing on winter pastures, traders said.
“Mixed with import restrictions, that’s given feeders a lot of strength,” Austin Schroeder, analyst at Brugler Marketing, said.
Wholesale choice boxed beef fell 31 cents to $311.26 per hundredweight on Wednesday, according to the US Department of Agriculture.
Declining pork values have weighed on hog futures, with the cutout falling $2.21 to $88.94 per cwt on Wednesday.
Most-active February lean hog futures hit a contract high, but settled down 0.350 cent at 87.925 cents per pound.
CME livestock commodities markets will be closed on Thursday for the Thanksgiving holiday and will re-open for an abbreviated session on Friday, ending at 12:05 p.m. CST.
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