CHICAGO, Nov 10 (Reuters) - Chicago Mercantile Exchange lean hog futures rose on Wednesday after the U.S. Department of Agriculture (USDA) said it will allow nine pork processing plants to apply to operate faster line speeds under a pilot program.
The announcement eased concerns that slower processing speeds had slowed meatpackers’ demand for pigs to slaughter, traders said.
Meatpackers were forced to slow processing after a federal judge in March struck down a 2019 rule that removed speed limits on certain plants.
The USDA’s new program “possibly removes a potentially bearish situation with slower chain speeds reducing the demand for hogs and causing some backups and weight gains,” said Dan Norcini, an independent livestock trader.
CME December lean hogs ended up 0.750 cent at 75.700 cents per pound. Earlier in the session, the contract dropped to its lowest price since Oct. 28 at 73.700.
In CME’s beef markets, December live cattle futures ended 0.200 cent lower at 132.000 cents per pound, after rising on Monday to their highest since Sept. 3 at 132.500 cents.
The most actively traded January feeder cattle contract fell 1.750 cents to settle at 158.050 cents per pound. The contract on Monday and Tuesday traded up to 160.600, which was the highest price since Oct. 27.
In other news, Brazil’s JBS SA posted third-quarter net income that exceeded analysts’ expectations on the strength of its U.S. meat business and higher domestic food sales, according to a financial statement on Wednesday.
U.S. meat processor Tyson Foods Inc is set to report quarterly earnings on Monday.
Reporting by Tom Polansek and Julie Ingwersen in Chicago; Editing by Sherry Jacob-Phillips
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