CHICAGO, Sept 29 (Reuters) – U.S. lean hog futures edged higher on Thursday, rebounding from an earlier seven-year low as investors squared positions ahead of a government supply report due on Friday, traders and analysts said.
Traders also were cleaning up their books ahead of the last day of the third quarter, with hogs on pace to decline 37 percent in what would be their worst quarterly performance in records dating back to 1973.
Chicago Mercantile Exchange live and feeder cattle futures were mostly lower and each was on pace for steep quarterly declines amid abundant livestock supplies and big stockpiles of beef, pork and poultry.
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Volumes and trading ranges were light in livestock, with each cattle contract trading within ranges established in the previous session.
CME October lean hogs slumped to the lowest levels for a front-month contract since October of 2009, before reversing slightly higher. Most-active December hog futures settled 0.275 cents higher at 46.975 cents per lb.
The move came ahead of the U.S. Department of Agriculture’s quarterly hogs and pigs report due on Friday. Analysts polled by Reuters expected the USDA to say the U.S. hog herd expanded about 1.2 percent to 70 million head as of Sept. 1.
“People are not doing much, just squaring up before the report tomorrow,” said James Burns, a broker at Rosenthal Collins Group.
Burns said a ramped up U.S. hog slaughter in recent weeks would boost pork supplies, adding pressure on prices both for hogs and pork meat. USDA after the close of trading said wholesale pork prices eased $1.12 to $74.05 per cwt, led by declines in ham and pork butt cuts.
“The 1998 low in December hogs was in the 43.500 cents area, and that’s a number I’m keeping my eye on,” Burns said.
CME December live cattle finished 0.500 cent lower at 103.125 cents per lb and CME October feeder cattle declined 0.525 cent at 127.500 cents per lb..
Ample cattle supplies continued to weigh on futures following lower trades in U.S. Plains cash cattle markets on Wednesday.
Live cattle on a continuous chart was set for their third straight quarterly loss, on pace to fall 15 percent for the third quarter. Feeders were on pace to lose about 7 percent for the quarter, and have not had a quarterly gain in two years.
