Chicago | Reuters — Live cattle futures on the Chicago Mercantile Exchange firmed on Wednesday, supported by strong cash markets and a steady pace of processing.
“Even though there’s a seasonal pullback for the next couple of weeks, it doesn’t look like cash wants to break,” said Scott Varilek, broker at Kooima Kooima Varilek Trading Inc. “I think there’s a little leverage in the producer’s side.”
CME benchmark February live cattle gained 0.87 cent, to 155.675 cents/lb. (all figures US$). The spot December contract added 0.4 cent to 153.075 cents/lb.
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CME January feeder cattle finished up 2.475 cents at 180.475 cents/lb.
Cash cattle traded as high as $158/cwt in the northern U.S. Plains and $154-$155 across the southern Plains, the U.S. Department of Agriculture said.
Meatpackers slaughtered 128,000 head of cattle on Wednesday, up 4,000 from the same period a year earlier.
“They are continuing to slaughter big numbers,” said Varilek. “I think it proves that they have a lot of meat sold out front.”
Boxed beef prices were mixed, with choice cuts adding 14 cents to $254.88/cwt, while select cuts eased 81 cents, to $255.01/cwt, USDA said.
Meanwhile, lean hog futures firmed after five days of lower movement on plentiful supplies of market-ready hogs, Varilek said.
“The availability of hogs is probably going to be here for a little bit,” he said.
The CME February lean hogs contract added 1.2 cents to 85.35 cents/lb. The nearby December hog contract added 1.825 cents to end at 82.9 cents/lb.
Processors slaughtered 494,000 hogs, up 46,000 from the same day last week and 15,000 more than the same week a year ago.
The CME’s lean hog index, a two-day weighted average of cash hog prices, fell 42 cents to $84.21/cwt, its lowest since Feb. 2.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.
