CHICAGO, July 10 (Reuters) - Chicago Mercantile Exchange
hogs on Tuesday marked new lows, and the August contract
fell by its 3-cents daily price limit, amid eroding cash prices
and the roll by funds, said traders.
Tuesday was the second of five days that CME livestock
market funds which track the Standard & Poor's Goldman Sachs
Commodity Index sold, or "rolled," August futures into
deferred contracts.
Futures drew more pressure from burdensome supplies ahead
and mounting U.S. trade worries with China and Mexico, they
said.
"Traders are growing increasingly concerned about the export
markets," said independent livestock futures trader Dan Norcini.
"U.S. pork needs those markets desperately because we have seen
that the industry is still in expansion mode," he said.
Prices for slaughter-ready, or cash, hogs have fallen the
past four sessions as packers try to conserve margins that
recently recovered from red ink, a trader said.
Processors are also having difficulty moving pork during hot
summer weather when consumers tend to eat lighter meals, he
added.
July hogs ended down 0.725 cent per pound at 79.500
cents. August closed 3.000 cents lower at 69.775 cents,
posting a new contract low.
CME's hog limit will expand to 4.500 cents on Wednesday.
LIVE CATTLE ENDS LOWER
Fund liquidation and a looming supply buildup weighed on CME
live cattle contracts, said traders.
The positive thing about people talking about big supplies
in July is it causes some feedlots to sell cattle sooner, which
could mean fewer animals later, said KIS Futures vice president
Lane Broadbent.
"The bottom line is cash prices were strong last week, beef
demand is still good ... cattle weights are manageable and
packers are making a lot of money," said Broadbent, who is
anticipating cash prices this week around $110 to $112 per cwt.
On Tuesday packers did not respond with bids after feedlots
in Texas and Kansas priced cattle at $116 per cwt. Last week,
cash cattle in the U.S. Plains moved at $112 to $114 versus $106
to $108 a week earlier.
August live cattle closed down 0.675 cent per pound
at 105.450 cents, and below the 100-day moving average of
105.729 cents. October ended 0.800 cent lower at 107.825
cents, and under the 20-day moving average of 108.080 cents.
CME feeder cattle closed moderately higher on short-covering
and strong cash feeder cattle prices.
August closed up 0.400 cent per pound at 151.850
cents.
(Reporting by Theopolis Waters
Editing by Chris Reese)
