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LIVESTOCK-CME lean hogs up on bargain buying; ample supplies cap rallies
By Julie Ingwersen
CHICAGO, June 19 (Reuters) - Chicago Mercantile Exchange (CME) lean hog futures closed higher on Wednesday in light bargain-buying after last week's slide to three-month lows, but soft cash markets and ample hog supplies hung over the market and limited rallies, traders said.
CME Group July lean hog futures settled up 0.150 cent at 81.625 cents per pound and most-active August ended up 1.300 cents at 83.000 cents per pound.
"There's not a lot of conviction on any side of the market," one Chicago-based trader said, noting that the pork cutout fell more than $3 per cwt on Wednesday.
"The other thing affecting the hogs is the huge kills. They are killing so many hogs here," the trader said, adding, "People have been whipped around here. They wanted to be long, but the fundamentals are not going along with them."
Traders awaited weekly export sales data on pork and beef due Thursday from the U.S. Department of Agriculture (USDA), with some hoping the report might show fresh sales of U.S. pork to China as the Asian country struggles with an epidemic of African swine fever in its hog herd.
Live cattle futures closed lower on weak cash values and lackluster consumer demand for high-priced cuts of beef, traders said.
CME most-active August live cattle settled down 1 cent at 104.550 cents per pound.
CME August feeder cattle ended down 0.725 cent at 136.525 cents per pound.
Packers in Texas and Kansas were bidding $109 per cwt for cash cattle, steady with Tuesday, while sellers were asking $112 to $115, traders said.
Cash beef values firmed a bit. The USDA quoted choice boxed beef cutout on Wednesday at $221.59 per cwt, up $1.06 from Tuesday, while select cutout rose $0.44 to $202.24.
But some traders felt that live cattle futures would struggle until the cash cattle market establishes a seasonal low.
"It doesn't seem like there is a need to pay up for cattle today ... Honestly, it's going to take more than the boxes to turn this around and get us moving higher," the Chicago trader said. (Reporting by Julie Ingwersen, editing by G Crosse)
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