Futures prices of hogs and pork bellies fell Monday on the Chicago Mercantile Exchange in anticipation of a seasonal increase in supplies.
Pigs born in the fall months are reaching slaughter weights, said Chuck Levitt, a livestock analyst in Chicago with Shearson Lehman Bros., and anticipation that the slaughter will increase pressured prices in the pork complex.
The decline in pork belly prices was sudden, said Phil Stanley, a livestock analyst in Chicago with Thomson McKinnon Securities, and prompted further selling by traders who had bought contracts earlier and were forced to liquidate their positions.
Cattle prices also were lower but the price move lacked the conviction of that in the hogs, analysts said.
Levitt said a sharp rally Friday indicated that prices might have reached the low for the season, but several days of stable prices would be needed to convince the market.
Stanley noted that cash cattle prices remained about 2 cents lower than current cash quotes and, since supplies are plentiful, demand would have to increase before prices could recover.