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CME lean hog futures fall on high supply, export demand concerns

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CHICAGO — Lean hog futures on the Chicago Mercantile Exchange eased for a fifth consecutive session on Tuesday, pressured by a combination added seasonal supply and deflated demand as China faces protests over COVID-19 lockdowns.

“This three-week period, we’re pushing a large supply of hogs through the system,” said Rich Nelson, chief strategist at Allendale, Inc. “Typically, this market does like to break on a seasonal basis, through the first week of December.”

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Nelson said uncertain export demand to China is adding to normal seasonal pressure.

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The CME February lean hogs contract lost 0.600 cents to 84.150 cents per pound after falling to 84.025 cents, the contract’s lowest since Oct. 17.

The nearby December hog contract added 0.475 cents to end at 81.075 cents per pound.

Processors slaughtered 494,000 hogs on Tuesday, up 15,000 from the same week a year ago.

Meanwhile, live cattle futures firmed, supported by tight cattle supplies, though seasonal pressures loom.

“Cattle does have a good story, but it has a seasonal price move in front of it,” said Nelson. “There’s a quick, short term, very severe drop ahead.”

CME benchmark February live cattle gained 0.125 cent to 154.800 cents per pound. The spot December contract added 0.100 cent to 152.675 cents per pound.

CME January feeder cattle finished up 1.125 cents at 178.000 cents per pound.

Boxed beef prices fell on Tuesday, with choice cuts losing $1.18 to $253.35 per cwt., while select cuts falling $1.99 to $226.54 per cwt. (Reporting by Christopher Walljasper; Editing by Krishna Chandra Eluri)

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