US pork demand weakness drives CME hog futures to contract lows
Lean hog futures on the Chicago Mercantile Exchange hit life-of-contract lows on Tuesday as analysts cite anemic demand for US pork.
Lean hog futures on the Chicago Mercantile Exchange (CME) dropped to life-of-contract lows on Tuesday, according to Mint, due to weak demand for US pork.
CME December lean hog futures set a contract low of 57.425 cents before ending at 58.600 cents per pound. The contract has fallen 27.5 per cent since late July.
Analysts said demand has suffered because US consumers face high gasoline costs and concerns regarding the flavour and moisture of pork. Exports have also been lackluster as China faces an oversupply of hogs and Mexico has imported less pork from the US.
The US Department of Agriculture (USDA) reported that US meatpackers slaughtered an estimated 493,000 hogs on Tuesday, which is 1.2 per cent higher than a year earlier. Total slaughterings this year are down 0.9 per cent at approximately 106.2 million hogs.
CME December live cattle also closed down 1.550 cents at 218.150 cents per pound, touching its lowest price since September 18. Analysts said uncertainty over demand for high-priced US beef weighed on cattle futures.
According to the USDA, meatpackers slaughtered an estimated 110,000 cattle on Tuesday, down 7.9 per cent from a year ago. Slaughterings this year are down 7.1 per cent due to tight inventories.
