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LIVESTOCK-CME hog futures stumble as supplies grow
October 18, 2016 / 7:41 PM / a year ago

LIVESTOCK-CME hog futures stumble as supplies grow

* Live cattle market extends gains
    * Feeder cattle finishes higher

    By Theopolis Waters
    CHICAGO, Oct 18 (Reuters) - Chicago Mercantile Exchange lean
hog futures on Tuesday slumped for a third consecutive
session, weakened by already ample supplies as Smithfield Foods'
 East Coast plants return to full operations after
being idled by Hurricane Matthew, traders said.
    Most-actively traded December lean hogs finished
down 0.475 cent per pound to 41.125 cents.
    Monday and Tuesday's combined hog slaughter totaled 881,000
head - 101,000 more than the same period a week ago, according
to U.S. Department of Agriculture estimates.
    "That's an awful lot of pork tonnage coming onto the market.
Pork demand is going to need to remain exceptional to absorb
this wall of pork coming our way," said independent livestock
futures trader Dan Norcini.
    Domestic pork demand held up fairly well as grocers feature
product during October National Pork Month, said traders and
Midwest hog merchants.
    A trader said prices for slaughter-ready, or cash, hogs in
the southeastern part of the country could suffer as packing
plants in the region take delivery of animals that had been
delayed by the storm.
    Hog merchants forecast this Saturday's hog slaughter at
280,000 head, which they said could increase depending on the
availability of animals on the East Coast.
    Last Saturday, packers processed 309,000 hogs, compared to 
231,000 a week earlier when Smithfield closed its Tar Heel, N.C.
plant as a safety precaution in advance of Hurricane Matthew.
    Anticipation for steady to firmer prices for
slaughter-ready, or cash, cattle by week's end lifted CME live
cattle contracts for a third consecutive session, said traders.
    October closed 0.475 cent per pound higher at 97.750
cents, and most-actively traded December closed up 0.225
cent to 99.225 cents.
    Healthy packer profits, firmer wholesale beef values and
fewer cattle for sale than last week bode well for this week's
cash prices, said traders and analysts.
    So far, cash cattle at small auction barns in the U.S.
Plains changed hands at $96 to $100 per cwt, versus overall cash
sales last week in the Plains at $97 to 98, an analyst said.
    Average beef packer margins for Tuesday were a positive
$147.20 per head, up from a positive $138.35 on Monday and up
from a positive $130.40 a week ago, as calculated by
    CME feeder cattle followed live cattle futures higher.
October feeders ended up 0.325 cent per pound to 122.025

 (Reporting by Theopolis Waters; editing by Grant McCool)

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