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Undated (AP) _ For the second day in a row, hog futures prices plummeted the limit allowed for daily trading at the Chicago Mercantile Exchange on concerns that labor disputes at several Midwest packing plants will backlog supplies.
Strikes have hit FDL Foods, Inc. plants in Dubuque, Iowa and Rochelle, Ill.; and Swift Independent Packing Co.’s Marshalltown, Iowa plant.
Meantime, workers at Fischer Packing Co.’s Louisville, Ky. plant voted Wednesday to reject a contract offer; their contract expires Monday. And a vote on a negotiated contract is expected Monday at Thorn Apple Valley’s Detroit hog slaughtering plant.
The strikes and fear of additional walkouts sparked a flurry of selling in the pork-belly and hog pits as traders were concerned with the threat of a supply backlog and subsequent weakening in demand, said Chuck Levitt, a Chicago analyst with Shearson Lehman Brothers Inc.
Pork-belly prices for nearby contract months fell the daily 2 cents-a-pound limit allowed at the Merc, but closed slightly above that, while October and December hogs closed down the daily 1.50 cents-a-pound limit.
Hogs were .20 cent to 1.50 cents lower, with October at 49.87 cents a pound; and pork bellies were .53 cent to 1.80 cents lower, with February at 65.50 cents a pound.
In other markets, energy futures prices dipped, precious metals were mostly lower, grains and soybean prices declined, while cattle futures were mostly higher.
Reports that Saudi Arabia and Kuwait will seek to boost production quotas at next week’s OPEC meeting sparked a selloff in energy futures prices on the New York Mercantile Exchange.
But analysts said the report out of Saudi Arabia was just grandstanding before the Organization of Petroleum Exporting Countries meeting in Geneva on Monday.
The cartel cannot afford not to renew the agreement to cut production, reached at a summer OPEC meeting, said Nauman Barakat, a petroleum analyst with Smith Barney, Harris Upham & Co. in New York.
The agreement reached at the previous meeting - to cut production by more than 3 million barrels a day - expires at the end of October.
Crude oil settled 24 cents to 49 cents lower, with the contract for delivery in November at $14.87 a barrel; heating oil was 1 cent to 1.91 cents lower, with November at 41.89 cents a gallon; and leaded gasoline was 1.30 cents lower with November at 42.20 cents a gallon.
Precious metals prices were mostly lower after yesterday’s sharp rally in response to fears that South Africa would retaliate for economic sanctions imposed by the U.S. Congress because of the nation’s race-separation policies.
But with no additional announcements from South Africa, trader anxiety that South Africa would curtail platinum exports also subsided. South Africa is a leading supplier of precious metals.
Platinum closed $7 lower to $9.10 higher on the New York Mercantile Exchange, with the contract for delivery in October at $589.60 a troy ounce.
At the Commodity Exchange in New York, gold settled $3.50 to $4.50 lower, with the contract for delivery in October at $433.70 a troy ounce; silver was 14.9 cents to 16.7 cents lower, with October at 564.8 cents a troy ounce.
Cattle futures prices were mostly higher, buoyed by expectations that labor disputes at pork packing plants could shift demand to beef. the second day in a row in trading on the Chicago Mercantile Exchange.
Live cattle settled unchanged to .38 cent higher with the contract for delivery in October at 59.45 cents a pound; feeder cattle were .03 cent lower to .35 cent higher with October at 60.07 cents a pound.
Grain and soybean futures prices fell at the Chicago Board of Trade, pressured by a forecast for dryer, crop-favoring weather starting this weekend.
Wheat settled 2 1/4 cents to 5 1/2 cents lower, with December at $2.68 1/ 4 a bushel; corn was 1 1/2 cents to 4 1/4 cents lower, with December at $1.69 3/4 a bushel; oats were unchanged to 2 cents lower with December at $1.23 3/4 a bushel; and soybeans were 4 1/2 cents to 6 1/4 cents lower with November at $4.82 a bushel.