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LIVESTOCK-U.S. hog futures hit 2-1/2-year high on packer demand
June 30, 2017 / 9:28 PM / 5 months ago

LIVESTOCK-U.S. hog futures hit 2-1/2-year high on packer demand

    By Michael Hirtzer
    CHICAGO, June 30 (Reuters) - U.S. lean hog futures        
surged to a 2-1/2-year high on Friday as recent gains in cash
hog prices prompted investor buying in futures, traders and
analysts said.
    Rising wholesale pork values underscored strong meat demand
and also bolstered futures while rising temperatures forecast
next week could slow the rate of weight gain in hogs, limiting
the supplies available to packers.         
    "The demand seems to be there," said Rosenthal Collins Group
broker James Burns. "Hogs have been coming in underweight
consistently for a while now and we have some heat that's coming
to Iowa next week."
     Chicago Mercantile Exchange July hogs        hit a peak of
90.850 cents per pound, the highest levels on a continuous chart
       since November 2014, before settling at 90.625 cents, up
1.150 cents.
     Most-active CME August hogs        rose by their daily
trading limit of 3.000 cents to a contract high of 83.750.
Trading limits will be expanded to 4.500 cents on Monday,
according to the CME Group.
    Futures remained discounted to the exchange's index of the
cash hog market       , which reached 91.660 cents, also a
roughly 2-1/2-year high.    
    The gains came a day after the U.S. Department of
Agriculture in a quarterly report showed a record-large U.S.
herd for the March-May quarter. However, record hog supplies
this year have been met by robust demand.             
    CME June live cattle futures        expired down 1.110 cents
at 119.100 cents per pound while most-active August live cattle
       eased 0.200 cent to 116.300 cents. However, most other
deferred cattle contracts notched small gains. 
    CME August feeder cattle futures        were up 0.750 cent
to 147.925 cents per pound.
    Technical short-covering and bear-spreading remained a theme
in cattle trading as investors exited positions in nearby
futures contracts. But recent declines in cash cattle prices and
wholesale beef continued to limit the upside.
    The USDA said wholesale choice beef prices eased $1.82 to
$224.73 per cwt and select cuts were down $1.74 to $208.42.

 (Reporting by Michael Hirtzer in Chicago; editing by Jonathan

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