Hogs Drop as Lower Feed Costs May Boost Pork Supply; Cattle GainElizabeth Campbell
Hog futures slumped for the third straight session on speculation that lower feed costs will increase pork supplies. Cattle rose.
Corn prices fell to a 33-month low today as rain and improved conditions boosted prospects for a record crop in the U.S., the world’s biggest producer and exporter. Corn is the main ingredient in livestock feed. Average hog weights in the Iowa and southern Minnesota region were 271.1 pounds (123 kilograms) in the week ended July 20, down 0.9 pound from a week earlier, government data show.
“Feed costs have dropped off, and hogs should be more profitable,” Lawrence Kane, a senior market adviser at Stewart-Peterson Group, said in a telephone interview from Yates City, Illinois. “We could possibly see more meat, heavier hogs with the cheaper feed.”
Hog futures for October settlement declined 0.4 percent to close at 84.5 cents a pound at 1 p.m. on the Chicago Mercantile Exchange. Prices slipped 0.2 percent last week.
Cattle futures for October delivery rose 0.1 percent to $1.25975 a pound on the CME. Prices are down 4.8 percent this year.
Feeder-cattle futures for August settlement added 0.4 percent to $1.53275 a pound.
Wholesale-beef prices fell 1.1 percent last week, the 10th straight decline, U.S. Department of Agriculture data show. That’s the longest losing streak since at least 2004. Prices slid 0.3 percent to $1.8652 a pound as of midday. That’s down 12 percent since reaching $2.1137 on May 23, the highest since at least 2004.
“I am expecting the beef to attract some business,” Dennis Smith, a senior account executive at Archer Financial Services Inc. in Chicago, said in a telephone interview.