Hog futures slumped to a four-month low on speculation that cooler weather in the U.S. Midwest may raise animal weights, increasing pork supplies. Cattle declined.
The Midwest will have cooler-than-normal conditions during the next 15 days, with temperatures ranging from 64 degrees Fahrenheit (17.7 Celsius ) to 80 degrees Fahrenheit according to MDA Information Systems. Average hog-carcass weights fell 1.1 percent this month through yesterday amid a heatwave, U.S. Department of Agriculture data show. Hogs eat less during hot weather.
“Seasonally, we’re coming into a time frame where the cooler weather is aiding weight gain,” Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa, said in a telephone interview. “The anticipation of larger supplies ahead is driving the market down. Weights will start to rise and should grow through next summer.”
Hog futures for October settlement declined 1.7 percent to 83.05 cents a pound at 10:46 a.m. on the Chicago Mercantile Exchange, heading for the fourth straight decline. Earlier, the price touched 82.925 cents, the lowest for a most-active contract since March 11.
Corn prices fell to a 33-month low yesterday on the outlook for a record crop in the U.S., the world’s largest producer and exporter. The grain is the main ingredient in livestock feed.
“If the grain prices continue to sit at these lower levels or move lower, you’re going to see further expansion for the weight of herds,” Roose said.
Cattle futures for October delivery declined 0.4 percent to $1.25425 a pound on the CME. Prices are down 4.8 percent this year through yesterday.
Feeder-cattle futures for August settlement fell 0.3 percent to $1.52875 a pound.
To contact the reporter on this story: Marley DelDuchetto Kayden in Chicago at firstname.lastname@example.org
To contact the editor responsible for this story: Steve Stroth at email@example.com