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Cattle & Hogs Rise as Hot Weather May Curb Supplies

August 4, 2010 at 21:47 by Vladimir Vyun

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.

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