U.S. livestock: Hog futures decline on technical selling
Michael Hirtzer, Reuters
via GFM Network News/Glacier FarmMedia Feed/Canadian Cattlemen - February 8, 2019
Chicago | Reuters — Chicago Mercantile Exchange lean hogs extended their decline to the fourth consecutive session on Friday, easing on technical selling and weaker pork prices, traders said.
The most active April hogs contract dropped to a fresh five-month low and has now declined in 12 out of the past 14 sessions. The contract settled down 1.175 cents at 58.425 cents/lb. (all figures US$).
“The (trading) volume is not that big, it’s just trend followers. It’s a snowball rolling down a hill,” Archer Financial Services broker Dennis Smith said of the declines.
Wholesale pork prices have also traded at the lowest levels since August, suggesting there was too much supply and not enough demand. The U.S. Department of Agriculture said the pork cutout was down 44 cents, to $65.17/cwt, and values for cuts such as hams, pork bellies and loins each fell.
Smith said buyers such as importers in China likely will take advantage of the low meat prices. Hog farmers in China have culled herds due to the African swine fever virus and buyers in China may need to tap overseas markets soon.
“I’m looking for a big surge in pork business … There’s no reason to wait to start booking (meat orders),” he said...