CHICAGO, Jan 29 (Reuters) - U.S. hog and cattle futures dropped to fresh multi-month lows on Wednesday.
Ample supplies and weakening cash markets weighed on the cattle contracts while concerns about demand from China pressured hog futures.
The pressure on cattle comes at a time of year when the market tends to find support due to lowered production.
“At a time when supplies should be tightening ... this market is finding a well-stocked cattle supply right now,” said Rich Nelson, chief strategist for Illinois-based commodities broker Allendale Inc.
The spread of a coronavirus raised concerns in the market about China boosting its purchases above what is mandated as part of the Phase 1 trade deal signed by Beijing and Washington on Jan. 15.
The outbreak that started in China has killed 133 people and spread to a dozen other countries, rattling global markets and prompting evacuation plans.
April live cattle futures dropped 0.475 cent to 120.225 cents per pound at the Chicago Mercantile Exchange, hitting their lowest since Oct. 18.
CME March feeder cattle futures ended down 0.425 cent at 134.975 cents per pound after hitting their lowest since Sept. 23.
CME February lean hog futures were 1.925 cents lower at 64.3 cents per pound. The most-active April contract dropped 2.475 cents to 68.825 cents, touching its lowest since Aug 5.
The chief executives of Brazil’s largest meatpackers JBS SA and BRF SA said on Wednesday that China’s meat imports will remain elevated in 2020 because of the lasting effects of African swine fever.
JBS CEO Gilberto Tomazoni, speaking alongside BRF CEO Lorival Luz, told an event in Sao Paulo that he expects the impacts of swine fever on the global meat market to peak in 2020. (Reporting by Mark Weinraub; Editing by Lisa Shumaker)