CHICAGO, Sept 26 (Reuters) - U.S. hog futures retreated on Thursday under pressure from large supplies and as some traders were disappointed with the size of pork export sales confirmed to China, analysts said.
The U.S. Department of Agriculture reported that the world’s biggest pork consumer and hog producer bought 3,375 tonnes of pork from Sept. 13-19. More export sales to China are expected to be confirmed next week, according to traders.
China needs meat because it is struggling with an outbreak of African swine fever, a fatal pig disease that has decimated its herd over the past year. The disease has also spread to Vietnam, South Korea and other countries.
“We did not see major Chinese purchases of pork,” a U.S. broker said. “The industry is a little disappointed.”
December lean hog futures finished down 1.025 cents at 70.375 cents per pound at the Chicago Mercantile Exchange.
On Friday, traders will digest quarterly data on the size of the U.S. swine herd from the USDA. Analysts on average estimate the U.S. hog inventory as of Sept. 1 at 77.268 million head, according to a Reuters survey. If realized, that would be 2.8% bigger than a year earlier.
In the beef market, December live cattle futures closed up 0.250 cent at 108.750 cents per pound.
November feeder cattle futures closed up 0.325 cent at 141.450 cents per pound.
Cash cattle prices this week and into next week will likely be about $104 per cwt, give or take $1, in a five-region area monitored by the U.S. Department of Agriculture, said Larry Hicks, president of CattleHedging.com. That would up from about $102 last week.
Futures markets have already priced in the rise in cash prices and could decline once cash trade are confirmed, Hicks said. He added that cash prices will back off in October but not make a new low.
The cash market has strengthened recently, after a fire at a Tyson Foods Inc slaughterhouse last month removed a key buyer from the market, sending prices tumbling. The slaughterhouse remains closed for repairs but meat packers have been killing more cattle at other facilities in the meantime.
Margins for beef packers on Thursday were $304.35 per head, up from $153.20 on the day of the fire.
Boxed beef prices rose by $1.10 per cwt for select cuts and declined by $0.73 for choice cuts, according to the USDA.
Reporting by Tom Polansek in Chicago Editing by Marguerita Choy