Hog futures rose, extending a rally to the highest in more than two years, on speculation that demand will climb for U.S. pork exports to China, the world’s top consumer. Cattle prices jumped the most in a week.
Shuanghui International Holdings Ltd., China’s biggest pork producer, agreed last month to acquire Smithfield Foods Inc., the leading U.S. hog processor. Last year, China was the third-largest buyer of U.S. pork. Yesterday, the wholesale price advanced 1.5 percent to 97.92 cents a pound, the highest in almost a year, government data show.
“It’s the rumors of export business that are helping hogs,” Lawrence Kane, a senior market adviser at Stewart-Peterson Group in Yates City, Illinois, said in a telephone interview. “The Smithfield deal certainly fuels the speculation that China wants some pork long term.”
Hog futures for July settlement rose 1.3 percent to close at 99.15 cents a pound at 1 p.m. on the Chicago Mercantile Exchange, after reaching 99.9 cents, the highest for a most-active contract since April 25, 2011.
Yesterday, the cost of hogs for immediate delivery at slaughtering plants climbed 0.9 percent to 95.81 cents a pound, an 11-month high, U.S. Department of Agriculture data show.
Cattle futures for August delivery increased 1.1 percent to settle at $1.197 a pound, the biggest gain since May 31.
Feeder-cattle futures for August settlement climbed 0.9 percent to $1.44675 a pound.
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