Pig futures rise to new highs
April 8, 2024
2 minutes reading time
Chicago Mercantile Exchange (CME) live cattle futures plunged to their lowest level since mid-January on Friday as concerns about beef demand due to reports of avian flu in cattle led to a long-term liquidation of the fund before the weekend, Reuters reported.
Technical selling accelerated the market's decline as prices fell below the lows seen earlier in the week.
Despite assurances from some government officials that food supplies were safe, investors feared that negative headlines about the increasing spread of bird flu in dairy cows could dampen consumer appetite for beef.
With futures markets closed until Monday's trading session, investors exited their long positions in case more negative news emerges over the weekend.
“The funds are moving in a safe haven based on the headlines in the news,” said Mike Zuzolo, president of Global Commodity Analytics.
U.S. officials said Thursday that bird flu first infected a dairy herd in Ohio and has been detected in additional herds in Kansas and New Mexico. The US CDC issued a health warning about bird flu on Friday.
CME live cattle fell to a low of 171,400 in June, the lowest since Jan. 16, and settled down 3,800 cents at 172,050 cents per pound.
Feeder cattle futures followed the decline in live cattle, with actively traded May futures falling 5.700 cents to 238.175 cents a pound.
While both cattle markets ended the week down more than 4%, CME lean pork futures rallied to new highs on Friday, posting gains for the fifth consecutive session on robust demand for hogs and pork.
The U.S. Department of Agriculture's estimated hog carcass volume rose this week to its highest level in six months.
Actively traded June hogs reached a contract high of 108.00 cents per pound and settled up 2.900 at 107.900 cents per pound. Contracts from May 2024 to October 2024 also reached lifetime highs on Friday.