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CME update: lean hog futures fall back as slaughter pace slows

US lean hog futures trimmed to their lowest point since 7 October on 11 November as a slower slaughter pace threatens to back up production.

12 November 2020, at 8:34am

Reuters reports that the lag in production is coinciding with a period of weaker domestic demand for pork.

December lean hog futures slipped 0.325 cent to 64.800 cents per pound.

The daily US hog slaughter fell to 459,000 head, down 6 percent from a week ago and 7 percent from the same week last year, according to USDA data.

"Are they going to maintain the slaughter pace we've seen the last couple weeks?" said Altin Kalo, an economist with Steiner Consulting Group. "Will producers start to get backed up, and will that put some pressure on price?"

Possible pork exports to China remained supportive of the market, as the nation struggles to rebuild its hog herd after African swine fever decimated its pork industry over the past two years. Traders will monitor pork sales in the USDA's next weekly export sales report, due on Friday 13 November, a day later than normal due to Wednesday's federal holiday.

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