November 19, 2018 / 11:00 PM / a month ago

LIVESTOCK-Hog futures rise to contract highs on export optimism

    By Michael Hirtzer
    CHICAGO, Nov 19 (Reuters) - U.S. lean hog futures        
rose to life-of-contract highs on Monday, extending steep gains
from last week on optimism for robust exports of American pork
due to the worsening African swine fever virus outbreak in
China, traders said.
    China, the top world hog producer and pork consumer, has
culled its swine herd as the highly contagious virus has spread.
An outbreak was reported on Friday in Sichuan province, the
country's leading pig-herding region.             
    Data released on Friday by the U.S. Department of
Agriculture showed large shipments of pork and new export sales,
including 3,800 tonnes sold to Hong Kong. That suggested that
buyers in China were turning to the global meat market.
    "The market had never come to terms with the disease
outbreak. They've been waiting for some evidence of exports (to
China)," said Archer Financial Services broker Dennis Smith.
    "What we've been doing technically - it's like a rocket
launch," he added.
    Hog futures on the Chicago Mercantile Exchange surged by
their 3.000 cents per pound daily price limits on Friday and
then continued their climb when trade resumed on Monday.
    Most-active February hog futures         were up 2.275 cents
to 69.025 cents per pound. December hogs         were up 0.950
cent to 61.025 cents, the highest in about seven months. The
December contract has now gained eight out of the past nine
sessions.
    Live cattle futures         were higher for the third
straight session, with December         ending up 0.800 cent to
116.150 cents per pound and February cattle         up 0.275
cent to 120.000 cents.
   Traders were looking ahead to Wednesday's USDA Cattle on Feed
report that was expected to show Nov. 1 on-feed supplies at
104.4 percent of a year ago.             
 

 (Reporting by Michael Hirtzer; Editing by Cynthia Osterman)
  
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