Chicago | Reuters — Chicago Mercantile Exchange feeder cattle and live cattle futures rose on Tuesday amid technical buying, while lean hog futures finished mixed.
Both cattle markets have been due to rebound after recent selloffs dragged prices too low at a time when demand is solid, brokers said.
Live cattle futures topped a one-week high after hitting a four-month low on Friday.
“Fundamentally I think we had gotten too cheap across the board in cattle,” said Ted Seifried, chief market strategist for Zaner Ag Hedge Group.
Front-month CME October live cattle futures settled up 0.2 cent at 122.825 cents/lb. (all figures US$). Deferred futures were higher, though the most-active December contract fell 0.2 cent to end at 127.85 cents. October and December contracts reached their highest prices since Sept. 27 during the session.
Most-active November feeder cattle ended up 1.85 cents at 156.875 cents/lb. and also touched its highest price since Sept. 27.
Further advances in feeder cattle futures could signal higher prices are in store for live cattle, Seifried said.
“The feeders are the leaders,” he said. “If feeders can continue to recover, that gives us reason to think that maybe live cattle can.”
In the pork market, CME October lean hogs settled up 0.175 cent at 90.975 cents/lb. Most-active CME December lean hogs sagged 0.55 cent to end at 82.55 cents and touched a one-week low.
Hog futures had been technically overbought and will likely attempt to bounce back following a correction, traders said.
U.S. wholesale pork cutout values, reported by the U.S. Department of Agriculture, were weaker. The carcass value dropped by $4.27, to $108.13 per hundredweight (cwt), and ham values sank by $14.93, to $76.94/cwt.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.