US hog slaughter rates drop - CME

Live cattle futures climb; November cattle placement drop
calendar icon 26 December 2022
clock icon 2 minute read

Chicago Mercantile Exchange (CME) Group live cattle futures firmed on Friday, as traders anticipated lower November feedlot placements in the US Department of Agriculture's (USDA) monthly Cattle on Feed report, released after the market close, Reuters reported.

The USDA reported feedlot placements in November fell 2% from a year ago. Analysts predicted a 4.2% drop in a Reuters poll of analysts.

"That wasn't as bullish as the trade wanted to see, so we may have a small step down on Tuesday off the open," said Rich Nelson, chief strategist at Allendale Inc. "We now have three months in a row of lower placements and are now developing a story of much tighter supply in Q2 and Q3."

Benchmark CME February live cattle eased 0.450 cents to 157.750 cents per pound.

January feeder cattle futures added 0.300 cents to 186.750 cents per pound.

Meatpackers slaughtered 104,000 head of cattle on Friday, according to the USDA. Packers are on pace to process 562,000 head this week, down 10.08% versus a week ago but up 15.4% from the same period a year ago.

CME's lean hog futures eased as frigid temperatures across the US Midwest cut hog processing, Nelson said.

"Next week we have a holiday reduced kill and can't take care of those numbers. We've got a large number of hogs to process in early January," he said.

Hog slaughter rates dropped to 96,000 head, versus 449,000 a week ago, the USDA said. For the week, hog processors are on pace to slaughter 1.769 million head, 32.75% fewer head than last week.

In its quarterly hog and pigs report, the USDA reported the US hog inventory as of Dec. 1 was down 2%, versus the trade expectation of a 1.5% drop.

CME February lean hogs lost 1.225 cents to 87.825 cents per pound. For the week, the contract lifted 2.39%.

© 2000 - 2024 - Global Ag Media. All Rights Reserved | No part of this site may be reproduced without permission.