U.S. livestock futures were mostly higher Wednesday on support from firm cash prices, hot weather and a rally in corn.
Chicago Mercantile Exchange lean hogs ended mostly higher. Lean hogs for July surged 1.85 cents, or 2.1%, to 91.35 cents per pound, while December hogs slipped 0.2% to 83.9 cents per pound.
The market's discount to cash prices has been a key driver of the market recently, analysts said.
"When you're running a discount in both the hogs and the cattle, you need fresh negative news, something that signals the discounts are [justified]," said Don Roose, president of U.S. Commodities in Des Moines, Iowa.
Instead, cash prices have remained firm and supplies are relatively tight, analysts said.
Hog weights that are lower than a year ago and hot temperatures were also supportive to the nearby months, Brian Brase, analyst for ADM Investor Services, added in a report to clients. Hot temperatures and high humidity stress hogs and limit their weight gain.
The warm temperatures are also conducive to improved demand, which had struggled throughout the spring as lousy weather limited grilling throughout much of the U.S.
Deferred contracts were weaker despite a sharp rally in the corn market, which typically supports prices as traders assume that hog producers will scale back their output because of feed costs, Brase added.
A stronger dollar, which limits exports, was also a negative factor for the market, Roose said. Exports have remained solid throughout the year, underpinning the market even when domestic demand has sagged.
Cash hog prices were reported mostly steady near midday. Expectations for supplies to tighten further led to predictions of stabilizing cash prices and possibly some higher bids for hogs to be delivered next week.
The terminal markets traded steady with top prices at mostly $60 on a live basis.
The latest Dow Jones Newswires pork packer margin index was minus $1.74 per head, compared with minus $2.32 the previous day.
The U.S. Department of Agriculture's pork carcass composite value, a measure of wholesale prices, Tuesday was up $0.77 per hundred pounds to $88.41 after hitting a 4 1/2-month low Monday.