Chicago | Reuters — Chicago Mercantile Exchange live cattle futures ended higher on Friday on expectations of higher cash cattle prices next week and position-squaring ahead of a long U.S. holiday weekend, traders said.
Benchmark CME October live cattle futures settled up 1.75 cents at 144.55 cents/lb., with December up 1.675 cents at 150.25 cents (all figures US$).
CME October feeder cattle followed live cattle higher, rising 0.6 cent to close at 184.95 cents/lb., shrugging off pressure from a bounce in corn futures.
An early rally in Wall Street stock indexes faded, but the U.S. dollar cooled, supporting commodities, after data showed the U.S. labor market is starting to loosen. Markets will be closed on Monday for the Labour Day holiday.
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Fat cattle traded in the southern Plains cash markets this week at around $141 per hundredweight (cwt), down $1-$2 from last week as meat packers covered their needs for a holiday-shortened kill schedule next week. But packers will have one less day next week to purchase cattle for a full schedule the following week, a factor that should lift prices.
“There’s a sense that the cash market is going to stay firm here,” said Doug Houghton, analyst at Brock Capital Management.
In the U.S. wholesale beef market, choice cuts rose $1.35, to $259.42/cwt, on Friday, pausing after a slide to a 3-1/2 month low on Thursday. Select cuts rose $1.99 to $238.58 per cwt, according to the U.S. Department of Agriculture (USDA).
CME lean hog futures closed lower, pressured by falling cash hog prices. October lean hogs ended down 1.925 cents at 90.025 cents/lb. while December hogs fell 1.075 cents to close at 82.7 cents/lb.
The CME lean hog index, a two-day weighted average of cash hog prices, fell to $106.26/cwt, down $1.36 from a day earlier and its lowest since June 2.
“Cash hog prices are just plunging at this point,” Houghton said. “It’s seasonally increasing hog supplies. And hog weights will probably start to go back up again soon,” he added.
Wholesale pork prices steadied a day after falling to the lowest level since mid-May. The USDA priced pork carcasses at $102.25/cwt on Friday afternoon, up 39 cents from Thursday.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
