Chicago | Reuters — Benchmark lean hog futures on the Chicago Mercantile Exchange set a one-month high on Monday on short-covering and bargain-buying as the July contract extended its rebound from life-of-contract lows set in late May, traders said.
CME July lean hogs settled up 1.975 cents at 91.6 cents/lb. after reaching 93.125 cents, the contract’s highest since May 1 (all figures US$). August hogs ended up 3.425 cents at 87.375 cents/lb.
Firmer cash hog prices lent support. The CME lean hog index, a two-day weighted average of cash hog prices, rose by 48 cents to $84.28 per hundredweight (cwt), its highest since Nov. 25.
Read Also
China soybean imports hit record June high on strong Brazil shipments
China’s soybean imports hit the highest level ever for the month of June, a Reuters calculation of customs data showed on Monday, driven by a surge in shipments from top supplier Brazil.
Commodity funds have been aggressively covering short positions in lean hog futures since the market bottomed in late May. Managed funds slashed their net short position in hog futures to 18,741 contracts in the week to June 6, data from the U.S. Commodity Futures Trading Commission showed, compared with the prior week’s net short of 35,442 contracts, the largest in CFTC records dating to 2006.
Traders shrugged off a slight down-tick in wholesale pork prices. The carcass cutout fell to $88.04/cwt, the U.S. Department of Agriculture said on Monday afternoon, down 35 cents from Friday and below a five-month high of $89.06 set one week ago.
Cattle futures also rose on Monday, supported by expectations of continued strength in cash cattle prices this week and rising beef prices.
CME August live cattle futures settled up 1.35 cents at 173.2 cents/lb. August feeder cattle finished 0.05 cent higher at 239.05 cents/lb.
USDA priced choice cuts of beef at $337.43/cwt in the wholesale market, up $4.50 from Friday. Prices for select cuts jumped $4.53, to $310.24/cwt.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
