Chicago | Reuters — Lightly-traded Chicago Mercantile Exchange feeder cattle on Friday climbed two per cent, their biggest daily increase in seven months, led by live cattle market advances, traders said.
Fund buying and buy stops surfaced after January and March surpassed their respective 20-day moving average of 221.46 cents and 218.46 cents (all figures US$).
January closed up the 4.5-cents per pound daily price limit at 223.95 cents, and March ended 4.125 cents higher at 221.45 cents.
Live cattle rally
CME live cattle futures turned up sharply, which wiped out Wednesday’s losses, sparked by futures’ discounts to this week’s cash prices, traders said.
February live cattle closed up 2.125 cents/lb. to 165.675 cents, and April was 2.175 cents higher at 164.575 cents.
This week, slaughter-ready or cash cattle in the northern U.S. Plains sold at $166 to $169/cwt, as much as $7 higher than a week ago, feedlot sources said.
Short-bought packers spent more for cattle while passing that cost on to grocers who are gearing up to feature beef in January, traders and analysts said.
After a seven-day upward trend, Friday morning’s choice wholesale beef price dropped 90 cents/cwt from Wednesday to $248.00. Select rose eight straight days to $238.97, up 40 cents from Wednesday, U.S. Department of Agriculture said.
Traders are keeping tabs on wintry weather poised to sweep into parts of the Midwest by Saturday.
Freezing rain and snow will make it difficult to truck livestock to market. And, frigid temperatures beginning early next week could slowdown cattle weight gains.
Hogs shrug off early selling
CME lean hogs drew support from buy stops and live cattle market advances that pared initial hog futures weakness, traders said.
February closed up 0.1 cent/lb. to 81.3 cents, and April 0.225 cent higher at 83.5 cents.
Packers lowered cash bids until they can work through ample supplies after closing plants during the New Year’s holiday, which limited futures gains, an analyst said.
Supermarkets are buying pork sparingly until they can clear product left unsold over the holiday, he said.
Friday morning’s average price for hogs in the Iowa/Minnesota market was at $72.95/cwt, $2.92 lower than on Wednesday, according to USDA.
USDA data showed the morning’s wholesale pork price had slipped 63 cents/cwt from Wednesday to $83.77, led by $4.19 lower costs for loins.
— Theopolis Waters reports on livestock futures markets for Reuters from Chicago.