June 3, 2011
US hog futures fall on looming waning pork demand
US hog prices plunge for the second straight day on speculations of waning demand for pork.
Wholesale pork fell 1.9% yesterday to US$0.8816 a pound, the lowest since January 27, government data show. US meatpackers processed 1.264 million hogs in the week through today, up 2.3% from a year earlier, Department of Agriculture figures show. Hogs in the spot market fell 3.7% in May, the first drop since October.
Meatpackers are "having trouble moving product," said Dick Quiter, an account executive at McFarland Commodities LLC in Chicago. "That's keeping a negative tone on prices."
Hog futures for July settlement fell US$0.1175, or 1.3%, to settle at US$0.87975 a pound at 1 p.m. on the Chicago Mercantile Exchange. The commodity has gained 7.1% in the past year.
Cattle futures for August delivery fell US$0.025, or 0.2%, to settle at US$1.03675 a pound. The price has gained 14% in the past year.
Feeder-cattle futures for August settlement were unchanged at US$1.23875 a pound.
Spot-steer prices have declined 0.2% from a week earlier. Feedlots bought 9.9% more cattle in April than a year earlier, increasing the number of animals coming to slaughter.
The market "still has large supplies to deal with," said Don Roose, the president of US Commodities Inc. in West Des Moines, Iowa.
