Livestock futures turned higher after a week punctuated by selloffs.
The hog market was rocked earlier this week by renewed tensions over the North American Free Trade Agreement, or Nafta, after Canada filed a complaint with the World Trade Organization over the Trump administration's use of tariffs.
Continue Reading Below
But futures steadied on Friday, helped by rising physical hog prices. Meat-packers are on track to increase their prices for hogs for three consecutive weeks. The price increases are caused by a number of factors, including frigid weather that slowed the rate of hog weight gains and increased competition among packers due to added slaughter capacity.
Cattle futures, meanwhile, started the week sharply lower but have since steadied. Cash prices for physical cattle are on track to fall for two consecutive weeks. With large supplies of cattle being fattened in the nation's feedlots for slaughter in the first half of this year, analysts expect the pressure on the cash market to continue.
Hog futures for February delivery rose 0.9% to 71.575 cents a pound at the Chicago Mercantile Exchange. February-dated live cattle contracts rose 0.3% to $1.17375 a pound, lower over the week.
The U.S. Department of Agriculture on Friday increased its forecast for red meat and poultry production in 2018 to a new record. The agency expects production of red meat, which includes beef and pork, to rise to 55.033 billion pounds from 52.071 billion in 2017.
Analysts say offsetting a glut will require rock-solid demand, both domestically and abroad. Per-capita consumption and exports of both beef and pork are due to rise in 2018 from a year earlier, the agency said, with overall red meat and poultry consumption at a record.
Write to Benjamin Parkin at email@example.com
(END) Dow Jones Newswires
January 12, 2018 16:46 ET (21:46 GMT)