U.S. lean hog futures closed higher on support from cattle and equities.
Lean hogs and other commodities were lifted by macroeconomic factors, including the weaker U.S. dollar and climbing equities, as worries about Europe's crisis eased for the day. A weaker dollar helps U.S. export prospects, which have been a key factor in high hog and pork prices this year. Another factor, soaring grain costs, added support Tuesday, as corn climbed again.
The cattle complex in particular, which has rallied this week on supply concerns, is supporting hogs, traders say.
But hogs' gains were limited by pressure from the cash market, said Mike Zuzolo, president of Global Commodity Analytics and Consulting. Seasonal pressure is another factor, as prices typically decline through October as hog weights climb and supplies increase, analysts said.
Cash hog bids were reported mostly steady with some locations with sufficient supplies for most of this week quoting weaker prices. Buying interest from plants needing hogs to fill their Friday or Saturday slaughter schedules could help keep prices from falling much, especially since processing margins have widened recently.
Producer resistance to selling at weak prices and continued high feed costs could work against packers' efforts to pull down cash prices, analysts said.
The latest Dow Jones Newswires pork packer margin index was plus $11.92 per head, compared with plus $14.58 the previous day.
The terminal markets traded mostly steady to up $1 a hundred pounds on a live basis.
The USDA's pork carcass composite value, a measure of wholesale prices, on Monday fell three cents to $97.81 a hundred pounds.