18 October 2024

2 minute read

By: Global Ag Media

North America

Chicago Mercantile Exchange (CME) lean hog futures eased on Thursday amid concerns about the risk of increased US trade tensions with China, reported Reuters. 

The United States sanctioned two Chinese companies and a Russian affiliate involved in making and shipping attack drones and warned the two countries to halt cooperation, boosting the Ukraine war effort.

The sanctions appeared to weigh on hog futures, a trader said, amid concerns about potential retaliation.

Analysts said a Donald Trump presidency could also lead to another trade war with China, the world's biggest pork producer and consumer, and threaten China's purchases of U.S. agricultural goods.

"There's a lot of talk that swing states polls are going to be bad for a trade war come next year," said Jeff Thompson, an analyst with Marex Capital.

CME December lean hog futures fell 0.025 cents to finish at 77.675 cents per pound.

CME December live cattle ended down 0.425 cent at 186.175 cents per pound, while November feeder cattle futures settled up 0.250 cent at 245.750 cents per pound.

With a little over two weeks left before the US presidential election, "I think we see this choppy, sideways kind of trade until we get there," said Karl Setzer, co-founder of Consus Ag Consulting.

"No matter what, we're going to get a new president this year, and traders are just kind of wanting to even everything and see what the new policies will be before they establish anything," he said.

The choice boxed beef cutout rose $0.13 to $319.26 per hundredweight, according to the US Department of Agriculture. Select boxed beef prices gained $1.15 to $293.52 per cwt.

Margins for beef packers continued to rise alongside the boxed beef rally, with packers estimated to be making $59.25 per head on Thursday. That was up from $39.60 per head on Wednesday and losses of $19.95 per head a week ago, according to livestock marketing advisory service HedgersEdge.