CHICAGO, May 7 (Reuters) – Chicago Mercantile Exchange lean hog futures finished lower Thursday on profit-taking after three consecutive days of gains, traders said.
May hogs closed 0.500 cent per lb lower at 79.850 cents per lb, and June down 0.550 cent to 83.500 cents per lb.
Despite strong pork cutout values, investors were nervous about further cash price direction as processor margins shrink.
“Packers would like to control production by pushing up the cutout, which they did, or lower cash bids,” said U.S. Commodities analyst Don Roose.
Read Also
Farm cash receipts rise in first half of 2025 on livestock gains
Farm cash receipts in the first half of the year were up 3.3 per cent over the same period last year buoyed by livestock receipts. Overall receipts between January and June totalled $49.6 billion, up $1.6 billion from the same period last year, Statistics Canada reported.
Thursday morning’s wholesale pork price, or cutout, climbed $1.19 per hundredweight (cwt) from Wednesday to $78.68 per cwt, according to the U.S. Department of Agriculture.
Market-ready, or cash, hogs in the Midwest Thursday morning were steady to up $1 per cwt, regional hog dealers said.
Thursday’s pork packer margins were a negative $6.55 per head, compared with a negative $5.60 on Wednesday, according to Colorado-based analytics firm Hedgersedge.com.
LIVE CATTLE DRIFT LOWER
CME live cattle felt pressure from cash price caution and funds that shifted June positions into back months, traders said.
Funds in CME live cattle and hog markets that follow the Standard & Poor’s Goldman Sachs Commodity Index (S&PGSCI) periodically sold, or rolled, their June long positions and bought deferred contracts.
Monday was the first of five days for the S&PGSCI roll process.
June ended 0.850 cent lower at 149.375 cents per lb, and August fell 0.650 cent to 148.275 cents.
Cash cattle bids in Kansas and Texas stand at $157 per cwt versus $163 asking prices, industry sources said.
On Wednesday, they said a few cattle in Nebraska sold at $157 to $160, compared to mostly $163 there a week ago. Last week, cash cattle in the U.S. Plains traded at mostly $160 to $163.
Market bulls viewed positive margins and the morning’s wholesale beef price jump as supportive for cash prices.
Bearish traders anticipate weaker cash values based on the seasonal buildup in supplies and packers curbing kills to conserve their margins.
Thursday morning’s choice wholesale beef price rose $1.73 per cwt from Wednesday to $257.88 per cwt. Select cuts jumped $2.04 to $246.04, the USDA said.
CME’s feeder cattle May contract drew support from lower corn prices, with remaining months pressured by live cattle market selling.
April closed 0.400 cent per lb higher at 214.900 cents, August down 0.075 cent to 216.800 cents and September ended 0.575 cent lower at 215.900 cents.
