U.S. lean hog futures rose their daily limit on Wednesday, hitting their highest in nearly two years on tight frozen stocks and expectations for strong Chinese demand, traders said.
The U.S. Agriculture Department’s cold storage report issued on Tuesday afternoon fueled buying on Wednesday.
“Belly and trim stocks are at four-year lows, providing support for lean hog futures, along with more reports of hog losses due to disease in China raising hopes for export business,” StoneX chief commodities economist Arlan Suderman said in a research note to clients.
Chicago Mercantile Exchange April lean hog futures rose three cents to 89.425 cents/lb. (all figures US$). The front-month contract hit its highest since May 24, 2019.
Cattle futures also were firm, with bargain buying noted after the most-active live cattle April contract hit its lowest in a month.
CME April live cattle futures rose 1.025 cents to close at 122.225 cents/lb., rising above its 30-day moving average. Resistance was noted at the contract’s 20-day moving average.
CME April feeder cattle rose 2.15 cents to 144.75 cents/lb.