October 3, 2008
Hogs fall as pork supply outpaces demand; cattle futures drop
Hog prices dropped for an eighth straight session, extending the longest slide in almost a year, on signs that pork supplies are outpacing demand.
Cattle prices also fell.
Government data show meatpackers selling 10.1 million pounds of pork in the first three days of this week, the least for the period in four weeks. The Department of Agriculture said last week the US hog herd totaled 68.7 million animals as of Monday, 1 September 2008, the most ever for that date.
Analysts said the hog market is worrying: The retailers can wait for distressed packers and those in need of selling pork to go to them. There are also another couple of months of record production ahead.
Hog futures for December settlement fell 1.675 cents, or 2.7 percent, to 61.3 cents a pound at 9:53 a.m. on the Chicago Mercantile Exchange. The price earlier touched 61.175 cents, the lowest for a most-active contract since March 12. Hogs have dropped 9 percent in eight sessions, the longest slump since a 10-session decline ended November 1.
USDA wholesale pork fell 1.15 cents or 1.6 percent to 72.85 cents a pound yesterday, the lowest since April 24. The price is down 8.4 percent since the beginning of July.
Cattle Futures Sink
Meanwhile, cattle futures for December delivery sank 2.475 cents, or 2.5 percent, to 98 cents a pound in Chicago. Earlier, the price touched 97.9 cents, the lowest since May 20. The price is still up 2 percent in the past year.
Beef demand is waning as the US economy slows and consumers eat fewer meals in restaurants.
Wholesale choice beef fell yesterday to the lowest since May 7, dropping 0.4 cent, or 0.3 percent, to US$1.55 a pound. The price has been down 9.4 percent in the past three months.
Feeder-cattle futures for November delivery dropped 3 cents, or 2.9 percent, to $1.006 a pound. Before today, the price had fallen 7.4 percent since the end of June.