CHICAGO, July 2 (Reuters) - Chicago Mercantile Exchange (CME) nearby lean hog futures closed higher on Tuesday for a second session on technical buying after last week’s multimonth lows and hopes that a resumption of U.S.-China trade talks could spur export demand for U.S. pork, traders said.
U.S. President Donald Trump and Chinese President Xi Jinping agreed in a meeting on Saturday at the Group of 20 summit in Japan to restart trade talks after the last major round of negotiations collapsed in May.
“There is still the idea that with the trade truce with China, we will see bigger pork movement there to help fill some of their swine-fever related gaps,” said Matthew Wiegand, broker with FuturesOne.
An epidemic of African swine fever, a fatal hog disease, has decimated millions of pigs in China’s domestic herd, increasing its reliance on pork imports.
“But we’ve had a hard time seeing much momentum this week as far as the cut-out goes,” Wiegand added, noting sluggish domestic cash pork values.
CME July lean hogs rose 1.150 cents to settle at 73.725 cents per pound and most-active August ended up 0.275 cent at 78.975 cents per pound, while deferred contracts closed lower.
“The cash market is trying to bottom (but) we still have the same issue. We’ve got record supplies of hogs,” said Don Roose, president of U.S. Commodities.
CME live cattle futures closed narrowly mixed, with most-active August unchanged at 104.100 cents per pound. October live cattle settled down 0.175 cent at 105.350 cents.
CME feeder cattle futures rose about 1%, supported by declining feed grain prices. August feeders settled up 1.350 cents at 138.375 cents per pound
Chicago Board of Trade corn futures firmed on Tuesday but were still down sharply from last week, and CBOT wheat fell nearly 8% in the last three sessions.
“Corn, at least, is not on this runaway to the upside ... so your input costs look like they are going to be manageable. That was supportive to the feeders,” Roose said.
Trade in CME Group livestock futures is scheduled to close early on Wednesday, at 12:15 p.m. CDT (1715 GMT), and remain closed for the Independence Day holiday. Trade resumes Friday. (Reporting by Julie Ingwersen; Editing by Lisa Shumaker)