Chicago | Reuters — Lean hog futures on the Chicago Mercantile Exchange inched higher on Monday as technical buying and worries about tightening U.S. hog supplies offset fears of slowing pork export demand and softening cash hog prices, traders said.
CME benchmark June lean hogs settled up 0.45 cent at 115.025 cents/lb. (all figures US$). The contract stabilized last week after a retreat from a life-of-contract high set March 31 at 127.325 cents.
“The market is treading water, waiting to see if exports pick up. Typically we start to see strength (in futures) as we get past April, into the summer months,” as the U.S. grilling season begins, said Don Roose, president of Iowa-based U.S. Commodities.
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The CME lean hog index, a two-day weighted average of cash hog prices, fell 62 cents to $100.06 per hundredweight (cwt). The index has been declining since setting a seven-month high on March 29 at $103.66/cwt.
In the cattle markets, CME live cattle futures closed higher while feeder cattle futures ended narrowly mixed, recovering after early declines. Both markets drew support from a retreat in nearby corn futures, signaling cheaper feed costs.
CME June live cattle settled up 0.975 cent at 134.8 cents/lb. May feeder cattle finished up 0.525 cent at 159.9 cents/lb. while August feeders finished down 0.25 cent at 173.3 cents, but pared losses after a dip to 170.85 cents.
Cash markets were quiet to start the week after market-ready cattle changed hands last week mostly at $138-$140/cwt. Roose said he expected a steady cash market this week.
Boxed beef prices inched higher, with choice cuts up $1.64 at $272.11/cwt, while select cuts fell four cents to $260.29.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
