Chicago | Reuters — Chicago Mercantile Exchange live cattle futures were narrowly higher on Wednesday, lifted by light technical buying as traders awaited deals in U.S. Plains cash cattle markets, analysts said.
Feeder cattle futures were slightly lower and lean hogs were mixed, with fresh news relatively scant.
Most-active CME October live cattle ticked up 0.25 cent to 108.7 cents/lb., finding downside support near its 100-day moving average and keeping within the wider trading range established on Tuesday (all figures US$).
Cattle had followed steep gains in lean hogs on Monday, on optimism that a new U.S.-Mexico trade deal could result in Mexico lifting an import tariff on American pork. But both markets fell on Tuesday as the initial hopes of a trade breakthrough faded.
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As the harvest in southern Alberta presses on, a broker said that is one of the factors pulling feed prices lower in the region. Darcy Haley, vice-president of Ag Value Brokers in Lethbridge, added that lower cattle numbers in feedlots, plentiful amounts of grass for cattle to graze and a lacklustre export market also weighed on feed prices.
Now, U.S. livestock traders were exiting some of their positions and waiting for further developments on NAFTA and to see how beef packers would bid for cattle this week.
“You’ve seen some people give up on their long positions,” one U.S. livestock trader said of cattle. “There’s some disappointment more than anything.”
Both cattle and hog markets have wrested with abundant U.S. supplies this year that made increased demand necessary to propel prices higher. But meat packers at times slowed their buying in efforts to pressure prices.
At the weekly online Fed Cattle Exchange auction, zero cattle were sold out of 751 head on sale, according to the auction website.
CME September feeder cattle were down 0.35 cent to 149.175 cents/lb., still holding above Monday’s roughly two-month low of 146.475 cents.
October lean hogs settled down 0.45 cent at 51.55 cents/lb., while December hogs were up 0.375 cent, to 53.725 cents.
Cash hogs in the top Iowa and Minnesota market declined 7 cents to $36.78 per cwt, according to the U.S. Department of Agriculture.
— Michael Hirtzer reports on commodity markets for Reuters from Chicago.
