Hog futures inched higher on soaring pork belly prices on Friday, while cattle futures were mixed.
Fresh pork belly prices are at all-time highs, according to Dennis Smith, a broker at Archer Financial Services. A pound of bellies rose 4.5 cents to almost $2.06 on Friday, near double the cost of a wholesale pork carcass.
Pricier bellies have come amid red-hot demand for fatty meats like bacon. Stocks in commercial freezers fell to a record low in May, the most recent month for which data is available, according to the U.S. Department of Agriculture.
That has helped carry hog futures, which have recently risen to multiyear highs. July-dated lean hog contracts rose 0.3% to 91.725 cents a pound on Friday at the Chicago Mercantile Exchange.
Cattle futures were mixed, closing lower after giving back gains during the session. CME August live cattle futures fell 0.2% to $1.14775 a pound.
In contrast to the recent rally in pork prices, beef is getting cheaper. Wholesale beef dropped over a cent to $2.19 a pound as of midday, on track for the lowest price since late April.
The cash trade for cattle is also trending lower, dragging futures along with it. Most of the week's trade was wrapped up earlier in the week, with live cattle sales averaging just below $1.18 a pound and dressed sales coming in a little under $1.88 a pound. Those prices were a little below the week before, and analysts expected the downtrend to continue.
"The cash cattle and beef markets still have downside risk in the coming week," said Troy Vetterkind, owner of Vetterkind Cattle Brokerage. "The futures aren't going to be able to do very much to the topside except for some light short covering."
Write to Benjamin Parkin at firstname.lastname@example.org
(END) Dow Jones Newswires
July 07, 2017 15:16 ET (19:16 GMT)