Chicago | Reuters – Chicago Mercantile Exchange lean hog futures tumbled about 3 percent to fresh life-of-contract lows on Wednesday as cash hog and pork prices extended declines amid abundant supplies and worries of sagging demand, traders said.
Most active October lean hog futures fell 1.575 cents to 48.400 cents per pound while front-month August hogs sank 1.000 cent to 54.800.
Hogs on a continuous chart were trading at their lowest in four months.
In the top cash hog market of Iowa and southern Minnesota, prices plummeted by $2.79 to $47.40 per cwt while wholesale pork values fell $1.08 to $70.97 per cwt, according to the U.S. Department of Agriculture.
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With supplies of pork, beef and chicken all ample in the United States, prices for pork have declined in a move necessary to stimulate buying at grocery stores and restaurants.
“The fundamental reason continues to be the same thing: too much product for the demand,” Don Roose, president of U.S. Commodities, said of the pork and hog market.
Worries of lost export sales of U.S. pork to top buyer Mexico has hung over the market after Mexico imposed tariffs on the meat. China, another major buyer, also put tariffs on U.S. pork imports, making domestic sales and exports to other destinations increasingly vital.
“We’re racing to the bottom to see if we can pick up some (pork) demand from beef and poultry,” Roose added.
Cattle futures were mostly higher, bolstered by short-covering and profit-taking after two straight sessions of declines.
Live cattle shrugged off earlier losses to turn higher as traders awaited deals in cash cattle markets.
CME October live cattle futures were up 0.075 cent to 111.000 cents per pound. CME September feeder cattle were up 1.025 cents at 149.750 cents per pound, rebounding from an earlier roughly one-month low of 147.200 cents.
Zero animals were sold out of about 460 cattle offered at the weekly Fed Cattle Exchange online auction, according to the auction website.
Choice-grade wholesale beef was up 24 cents to $205.73 per cwt, according to USDA.
