June 11, 2018 / 8:48 PM / 11 days ago

LIVESTOCK-Profit-taking, renewed trade fears drop CME hog futures

    CHICAGO, June 11 (Reuters) - Chicago Mercantile Exchange hog
futures on Monday reversed Friday's advances, hit by
profit-taking and renewed concerns over U.S. exports following
late last week's contentious G-7 summit, said traders.
    Europe will implement counter-measures against U.S. tariffs
on steel and aluminum just like Canada, German Chancellor Angela
Merkel said on Sunday, voicing regret about President Donald
Trump's abrupt decision to withdraw support for a G7 communique.
            
    "It's uncertainty over trade that's dragged everything down
from grain to livestock," a trader said.
    Last Friday, CME hogs finished up sharply after the Mexican
government said it would import some U.S. pork duty free under
an import quota despite retaliatory measures taken earlier in
the week after Washington hit Mexico with higher steel and
aluminum tariffs.                
    CME hogs drew more pressure from fund liquidation and 
future's premium to the exchange's hog index for June 7 at 74.57
cents.
    Thinly-traded June hogs, which will expire on Thursday, was
supported by Monday's higher wholesale pork values and rising
prices for market-ready, or cash, hogs.                 
    Packers hiked hog bids amid seasonally tight supplies as hot
weather in parts of the U.S. Plains slow animal weight gains,
said analysts and traders. 
    Ribs and pork chops are being featured by supermarkets and
restaurants for spring barbecues and Father's Day on June 17,
they said. 
    June         hogs closed up 0.275 cent per pound at 80.150
cents. Most actively-traded July         ended 1.325 cents lower
at 79.400 cents. August         finished 1.575 cents lower at
75.550 cents.
   
    CATTLE FALLS FROM HIGHS
    CME live cattle closed lower on risk-off trading and worries
about a looming supply buildup, which pared early-session gains
spurred by Friday's strong cash prices, said traders.
    "Grains started the risk-off type of trade. And we still
haven't figured out if we're going to be able to absorb all this
meat coming at us in the summer," said U.S. Commodities
President Don Roose.
    On Friday market-ready, or cash, cattle in the U.S. Plains
brought $114 to $115 per cwt, up from mostly $110 the week
before.
    Processors competed for supplies, encouraged by their still
historically high margins while filling pre-booked retail meat
orders, said analysts and traders.
    June         live cattle closed down 1.375 cents per pound
at 108.650 cents. August         ended 1.600 cents lower at
104.175 cents.
    Technical buying and lower live cattle futures undercut CME
feeder cattle contracts.
    August         closed down 1.325 cents per pound at 145.950
cents.

 (Reporting by Theopolis Waters)
  
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