U.S. lean hog futures jumped to the highest levels in three months on Wednesday, rising alongside wholesale pork prices before some hog contracts turned lower on profit-taking, traders and analysts said.
Chicago Mercantile Exchange cattle futures were mostly higher, buoyed by expectations that U.S. consumers will buy more meat for outdoor grilling as temperatures rise.
Prices for both pork and beef have risen sharply in May as retailers made purchases to stock meat coolers ahead of the U.S. Memorial Day holiday on May 29 – the unofficial start of the summer grilling season.
“Pork looks like it’s getting a bid – attracting some serious buying,” said independent livestock trader Dan Norcini.
The wholesale pork cutout gained $2.18 to $87.26 per cwt, the highest since July, according to U.S. Department of Agriculture data.
CME June lean hogs reached a peak of 79.950 cents per pound, before finishing 0.175 cent higher at 78.900 cents. July hog futures declined 0.475 cent to 79.000 cents.
Norcini said investors locked in profits when hog futures neared 80 cents per pound. “If we get consistently warm weather, that should generate good pork demand,” he said.
Cattle futures, which have eased from the one-year highs notched two weeks ago, climbed slightly even as wholesale beef prices declined.
CME June live cattle were up 0.550 cent at 122.450 cents per pound and August cattle were up 0.575 cent to 118.825 cents. CME August feeder cattle edged up 0.025 cent to 147.725 cents per pound.
Choice-grade beef fell $1.17 to $248.17 per cwt, the USDA said after the closing of futures trading.
Cattle for prompt delivery fetched an average price of $135.16 per cwt at the weekly online Fed Cattle Exchange auction, according to the auction website. That is down from $138.72 per cwt a week ago.