Hog futures rallied, supported by bets that prices for physical hogs were reaching a low point.
Falling cash prices for slaughter-ready hogs, a product of growing herd sizes and heavier hogs, weighed down futures through much of September. But prices last week showed signs of stabilizing, rising 53 cents to $47.74 per 100 pounds on Friday. Analysts expected prices to continue steadying this week.
Continue Reading Below
"Monday is a big day to secure hogs and starting the week off steady is a major change from the previous eight weeks," said Dennis Smith, a broker at Archer Financial Services. "Futures have responded in kind."
Most-active December lean hog futures rose 3.4% to 61.975 cents a pound at the Chicago Mercantile Exchange, the highest close in over six weeks. The front-month October contract rose 3.3% to 57.25 cents a pound.
Wholesale pork prices were also higher at midday Monday, rising 63 cents to $73.96 per 100 pounds, with pork belly prices in particular rising by over $5. Analysts said cheaper pork prices -- which have fallen sharply in recent weeks -- should attract global buyers, helping lift the broader hog market.
Cattle futures closed lower after initially rising. Larger slaughter numbers and meat production are pressuring prices, analysts said, with wholesale beef prices falling at midday Monday.
CME October live cattle futures fell 1.2% to $1.07825 a pound.
Write to Benjamin Parkin at email@example.com
(END) Dow Jones Newswires
October 02, 2017 15:22 ET (19:22 GMT)