Hog futures were mixed on Wednesday as a multiday rally stumbled.
Lean hog contracts for October rose 0.8% to 60.325 cents a pound at the Chicago Mercantile Exchange, extending gains for the week. The most-active December contract fell, tightening the spread between the two.
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Market participants said the recent rally showed signs of losing steam. Open interest, or participation in the market, fell on Tuesday as buying interest waned. Traders continued to get out of positions on Wednesday, analysts said.
The hog market has been buoyed by three consecutive days of higher cash prices for slaughter-ready hogs. Meatpackers paid an average of $49.67 per 100 pounds on Tuesday, up over a dollar from a day earlier, and prices were expected to rise further on Wednesday.
Strength in the cash market came as expanding slaughter capacity allowed meatpackers to keep physical hog supplies in check. Wholesale pork prices have continued to trend lower, however, as otherwise strong demand for pork struggled to keep up with increased production.
Cattle futures were little changed, giving back earlier gains. CME October live cattle contracts were steady at $1.09075 a pound.
Meatpackers paid mostly steady prices at the online Fed Cattle Exchange auction on Wednesday morning. They bought almost 800 head of cattle for $108 per 100 pounds on a live basis, in line with last week's prices.
That helped buttress the futures market, despite larger supplies of slaughter-ready cattle this week.
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(END) Dow Jones Newswires
October 04, 2017 15:25 ET (19:25 GMT)