Hog futures climbed on signs of increasing demand for U.S. animals. Cattle prices fell.
Wholesale pork, known in the industry as the cutout, added 3.5 percent last week, the third straight weekly gain, U.S. Department of Agriculture data show. About 46.45 million hogs have been commercially slaughtered in the five months through May 31, up 0.5 percent from the same period in 2012, the USDA said in a report on June 20. Spot-hog prices are up 8.2 percent this month through June 21.
“The big factors are cash and cutout are still rolling right along, still strong,” Lou Arens, a broker at PCI Advisory Services in Waucoma, Iowa, said in a telephone interview. “As long as this cutout keeps going, the packers can still afford to keep buying and pushing the prices higher.”
Hog futures for August settlement rose 0.8 percent to 98.2 cents a pound at 10:34 a.m. on the Chicago Mercantile Exchange. The August contract climbed 1 percent in 2013 through June 21.
Cattle futures for August delivery slipped 0.2 percent to $1.213 a pound on the CME. The contract was down 6.6 percent this year through June 21.
Feedlots sold 1.948 million head of cattle to meatpackers last month, down 3.4 percent from a year earlier and the second-fewest transactions for the month of May since the data series began in 1996, the USDA said in a report after the close of regular trading on June 21. Analysts in a Bloomberg survey had projected a 1.9 percent slide, on average.
“The marketings were not as good as expected,” Dennis Smith, a senior account executive at Archer Financial Services Inc. in Chicago, said in a telephone interview. “We moved fewer cattle into the slaughter chain.”
Wholesale beef fell 0.1 percent last week, the fifth straight decline, government data show. That’s the longest slide since February.
Feeder-cattle futures for August settlement added 0.6 percent to $1.4775 a pound.
To contact the reporter on this story: Elizabeth Campbell in Chicago at email@example.com
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org.