Commodity Blog

Commodity Prices – Hogs

Hogs futures gained today on speculation that prices declined too much last week, considering strong demand in the US. Exports of meat rose, also adding to demand. October futures for hog settlement rose $0.00275 (0.4 percent) to $0.7515 per pound by 13 on CME.

Soybean prices dropped today on speculation that demand in China and the US may slow after prices surged. November futures for soybean delivery slid $0.125 (1.2 percent) to $10.10 per bushel as of 13:15 on CBoT, the biggest drop since August 19th. December futures for soybean-oil delivery dropped $0.0048 (1.2 percent) to $40.05 per pound.

Corn slipped today as rains improved outlook for wheat output and on speculation that demand for ethanol would fall after oil prices declined. Speculators continue to bet on price increase, anyway. December futures for corn delivery fall $0.0225 (0.5 percent) to $4.3925 per bushel on CBoT.

Cattle futures surged as unusually hot weather in US may cause decrease of animals’ weight, reducing beef supplies from the US. Hogs prices also rose. Animals tend to gain less weight when weather is hot as they eat less food. And weather is hot as average temperature in major cattle-producing states was 43 degrees Celsius (110 Fahrenheit).

Average weight of steer carcasses at slaughter was 391.5 kg (863 pounds), 2.9 percent less compared to the same period in the previous year. CME-monitored inventories of pork bellies dropped 73 percent in the year through July after hog producers in the US cut herds to curb their losses in 2008 and 2009. Low supplies should support prices. On the other hand, high prices may damp demand from retailer.

October futures for cattle delivery rose $0.01575 (1.7 percent) to $0.958 per pound as of 11:44 on CME. October futures for hog settlement went up $0.0015 (0.2 percent) to $0.79075 per pound.

Hogs futures slipped today on forecast that high US pork prices may diminish retail demand. Meatpackers shipped 9.215 million pounds of pork last week, the worst week since late June. October futures for hog settlement slid $0.003 (0.4 percent) to $0.793 per pound at 9:42 on CME.

Raw sugar experienced a strongest decrease in almost two moths on speculation that supplies from Brazil and India, the world’s largest producers, would increase, erasing the global deficit. Production in Brazil’s Center South increased by 26 percent in the first half of July, while cane planting in India was boosted by rains, which were 2.5 percent above the 50-year average in July. October delivery for raw sugar slumped $0.0079 (4.1 percent) to $0.1861 per pound by 9:45 on ICE.

Coffee futures dropped the most in two weeks on speculation that the commodity rallied too much, considering the anticipated high supplies from Brazil, the biggest producer. Global coffee production may grow 12 percent to 135 million bags in the year starting October 1st. September delivery for Arabica coffee slid $0.0475 (2.8 percent) to $1.6775 per pound as of 10:04 on ICE.

Cocoa futures gained today after the report about increased demand in North America. The cocoa grind increased by 12 percent in the second quarter to 117,657 metric tons compared to the previous year. Analysts say that grinding numbers show strong demand and support prices. September delivery for cocoa rose $21 (0.7 percent) to $3,165 per ton on ICE.

Hogs futures went up today as hot weather in the U.S. causes decrease of animals’ weight, causing concern about declining pork supply. The animals tend to eat less with such jot weather, decreasing their weight. Hogs purchased yesterday by pork processors weighed 2 kilograms (4.44 pounds) compared to the same day in the previous month. October futures for hog settlement gained $0.00375 (0.5 percent) to $0.757 per pound on the CME.

Cattle and hogs futures gained today on outlook that demand for U.S. exports would rise as stocks gained and the dollar fell. The dollar tumbled today as much as 0.8 percent versus the basket of six major currencies, increasing attractiveness of U.S. exports. August futures for cattle delivery gained $0.01275 (1.4 percent) to $0.9075 per pound by 9:14 on CME. August futures for hog settlement went up $0.00525 (0.7 percent) to $0.80575 per pound.

Copper prices rose today as declining stockpiles suggested that demand would remain strong despite the slowdown of the global economic recovery. LME-monitored inventories declined 12 percent this year and fell to the lowest level in seven months today. September futures for copper delivery rose $0.092 (3.2 percent) to $3.9925 per pound by 11:33 a.m. on COMEX.

Corn prices dropped today on prediction that rainfalls would increase soil moisture and boost harvest in the U.S., the largest exporter in the world. Analysts say that prices are high enough, despite fewer than planned acres were sowed last month because of unfavorable weather. December futures for corn delivery slid $0.0275 (0.7 percent) to $3.8175 per bushel as of 12:54 on CBoT.

Raw sugar rose today for a third consecutive day on outlook for increasing purchases from Russia next month as the import tax was lowered. Analysts say that sugar prices may go up 30 percent in 2010 on rising demand, low output and transportation delays. October delivery for raw sugar gained $0.0026 (1.6 percent) to $0.1654 per pound on ICE.

Cattle and hogs slid today on concern for economic growth as the U.S. payrolls was lower than expected. Demand for meat also tends to fall in July and August because of hot weather. August delivery for cattle futures slipped $0.002 (0.2 percent) to $0.8975 per pound as of 12:01 p.m. on CME. August settlement for hog futures dropped $0.008 (1 percent) to $0.8105 per pound.

Cocoa dropped today on concern that the U.S. economic recovery would stall, damping demand for commodities. U.S. nonfarm payrolls dropped in June more than expected. Housing market and manufacturing sector also showed signs of weakness. September delivery for cocoa declined $70 (2.3 percent) to $2,971 per metric ton on ICE.

Wheat futures dropped today as favorable weather may help U.S. farmers to accelerate harvest. Demand for U.S. wheat also fell because importers turned to supplies from the Black Seas region. September futures for wheat delivery slid $0.06 (1.3 percent) to $4.65 a bushel on CBoT.

Soybeans gained today, erasing the previous losses, on speculation that excessive precipitation in the U.S. would reduce the area, in which the crop would be planted. Soybean planting probably may drop from the forecast 78.1 million to 76.5 million acres. November futures for soybean delivery slipped $0.06 (0.7 percent) to $9.18 per bushel as of 1:12 p.m. the Chicago Board of Trade.

Hog futures slid today on speculation that increasing profits would encourage U.S. farmers to reduce cuts of hog herd. According to analysts, producers aren’t expanding for now, yet they may be planning to do that in future. August futures for hog settlement subtracted $0.0175 (2.1 percent) to $0.82175 per pound on CME.

Sugar futures were shifting from losses and gains, after jumping to the highest level in nine weeks in New York on speculation that demand would remain at the present level. Complicated credit situation and high prices depleted sugar inventories last year, prompting consumers to restock their supplies and supporting demand. October delivery for raw sugar slid $0.0001 (0.1 percent) to $0.1618 per pound on ICE Futures U.S. October futures for white-sugar delivery added $10.60 (2.3 percent) to $478.70 per metric ton on the Liffe exchange.

Hog and cattle futures gained on prospect for resuming imports of U.S. chicken to Russia would cause the U.S. meat supplies to dwindle. Russia, previously the biggest consumer of U.S. chicken, has agreed to lift a five-month-old ban on the meat after yesterday’s meeting of U.S. and Russian presidents. August futures for hog settlement advanced $0.00225 (0.3 percent) to $0.83475 per pound by 10:57 on CME. August futures for cattle delivery rose $0.0025 (0.3 percent) to $0.894 per pound.

Cotton prices rose on outlook for increasing demand from mills in the U.S., the biggest exporter of the fiber. U.S. mills used the fiber at an adjusted annual rate of 3.582 million bales in May, compared to the April rate of 3.48 million and up 7.6 percent compared to the previous year. December delivery for cotton gained $0.0028 (0.4 percent) to $0.79 per pound at 10:10 a.m. on ICE.

Coffee slipped today on forecasts about high output in Brazil. Analysts think that the previous high prices haven’t reflected the supply and demand balance and the correction was expected. September delivery for Arabica-coffee fell $0.008 (0.5 percent) to $1.60 per pound by 8:32 on ICE Futures U.S.

Wheat declined today for the third consecutive session as hot weather in the U.S. made fields dry enough for harvest. U.S. winter crop harvest was completed at 17 percent as of June 20th, up from 9 percent the week before. September futures for wheat delivery slid $0.04 (0.8 percent) to $4.7325 per bushel by 10:07 on CBoT.

Hog and cattle futures gained today as prices for wholesale-meat rose with expectations of increased demand in the U.S. as summer grilling started. Demand should increase with the coming of the U.S. Independence Day holiday on July 4, encouraging grocers to increase their stockpiles. August futures for hog settlement rose $0.00325 (0.4 percent) to $0.84675 per pound as of 10:11 on CME.

Copper gained today for the sixth successive session as the dollar weakened, boosting demand for commodities. The U.S. dollar dropped as much as 0.7 percent versus the basket of six major currencies. September futures for copper delivery gained $0.0115 (0.4 percent) to $3.024 per pound on COMEX.

Cattle and hogs advanced today on signs that the demand will rise. Rising equities and falling dollar also added helped the prices. August futures for cattle delivery advanced $0.00475 (0.5 percent) to $0.886 per pound on CME.

Sugar declined today on speculation that the prices will go down. Concerns arose among trader that the sugar rally was overdone and the prices won’t be held on the current level. October delivery for raw sugar slid $0.0004 (0.3 percent) to $0.1595 per pound on ICE.