April 8, 2021

CME lean hog futures up due to African swine fever concerns, cattle futures also up

Lean hog futures on the Chicago Mercantile Exchange (CME) was up on April 7 due to African swine fever concerns in Asia, while live cattle futures ended higher thanks to high demand for US beef, Reuters reported.

The Philippines announced a reduction on pork import tariffs, with a goal to import 400,000 tonnes of the meat this year. This is more than double of what the country originally targeted.

June lean hogs on the CME ended 2.275 cents up at 107.900 cents per pound, with the highest at 108.125 cents.

The CME lean hog index increased to US$100.34 per cwt, the highest since October 17, 2014. The lean hog index is a two-day weighted average of cash prices.

Daily swine slaughter in the US remains strong despite a smaller herd, according to the US Department of Agriculture. USDA data showed 494,000 swine processed on April 7, up 21,000 head compared to the same date in 2020.

CME live cattle was also up with boxed beef leading the market. According to the USDA, choice cuts of boxed beef increased US$3.54 to $266.31 per cwt. Select cuts increased $3.89 to $255.19 per cwt.

Dennis Smith, a commodity broker at Archer Financial, said this was thanks to high demand for US beef.

June live cattle on the CME ended 0.650 cent higher at 125.275 cents per pound, after reaching a contract high 125.350 cents plus life-of-contract highs for the August and October 2021 contract months. Feeder cattle futures for Mau was up 0.90 cent to 152.675 cents per pound, reaching life-of-contract highs from August 2021 on.

- Reuters