Hog futures rose on strong pork demand Friday despite a government report showing the U.S. herd swelling to the largest on record for this time of year.
Lean hog futures for July delivery climbed 1.3% to 90.625 cents a pound at the Chicago Mercantile Exchange, hitting a fresh 2 1/2-year high. The more actively traded August contract jumped 3.7% to 83.75 cents a pound.
High pork prices, which recently rose above $1 a pound, have fueled a rally in the hog futures market on a grilling-demand boost ahead of July 4 festivities. Some traders are bracing for pressure after the holiday, however, and pork prices eased on Friday morning.
Meanwhile, the U.S. Department of Agriculture said late Thursday that the number of hogs and pigs nationally as of June 1 rose 3% from the same time last year to 71.7 million head, the highest since estimates began in 1964. Herds kept for breeding rose 2% while market-ready hogs grew 4%, also a record.
But market reaction to the increases was muted, with analysts saying the changes were largely expected. Factors like expanding pork exports and new slaughterhouses to process the supply would limit the impact of the greater inventory on prices, said analyst John Ginzel of Linn & Associates.
Cattle futures were little changed after a mixed week marked by a continued slide in cash prices. The CME's June live cattle contract expired 0.9% lower at $1.191 a pound, while August futures dropped 0.2% to $1.163.
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(END) Dow Jones Newswires
June 30, 2017 15:45 ET (19:45 GMT)