U.S. livestock: CME live cattle stretch rally into fourth straight day

(Photo courtesy Canada Beef Inc.)

Chicago | Reuters –– Chicago Mercantile Exchange live cattle barely eked out a four-day win streak after Tuesday’s choppy session, underpinned by anticipation of the same or better cash prices than a week ago, traders said.

Spot-August futures closed 0.225 cent/lb. higher at 148.225 cents, and October up 0.1 cent at 148.2 cents (all figures US$).

Some packers still need supplies despite cutting back kills to grow their margins and generate wholesale beef buying interest, a trader said.

Roughly 12,000 fewer cattle for sale than last week is considered supportive to cash prices, he said.

Cash and futures have bottomed out seasonally, but more cattle supplies at heavier weights lay ahead, said Livestock Marketing Information Center director Jim Robb.

Last week, slaughter-ready (cash) cattle in the U.S. Plains sold at mostly $147-$149/cwt, feedlot sources said.

Tuesday morning’s wholesale choice beef price fell 81 cents/cwt from Monday to $233.18/cwt. Select cuts dropped 88 cents, to $227.95, the U.S. Department of Agriculture said.

Beef processor margins for Tuesday were at a negative 85 cents per head, compared with a negative $1.40 on Monday and a negative $30.65 a week ago, as calculated by HedgersEdge.com.

CME feeder cattle drew support from modest live cattle market gains.

August finished up 0.1 cent/lb. at 213.95 cents.

Pork prices pull up hog futures

CME lean hogs closed higher in response to the morning’s wholesale pork price upswing, traders said.

Spot-August futures, which will expire on Aug. 14, closed up 1.2 cents/lb. at 81.4 cents, and most-active traded October finished 2.025 cents higher at 67.35 cents.

USDA reported Tuesday morning’s wholesale pork price at $89.31/cwt, a $1.37 jump from Monday.

With respect to the retail and wholesale pork sector, some integrated packing operations “are doing better on the pork side than on the beef side,” said Robb.

Initial conflicting cash price information sidelined some would-be futures buyers.

On Tuesday morning, the average cash hogs price in the western Midwest slumped $1.36/cwt from Monday to $75.07, the USDA said.

Cash hogs in the Midwest traded steady to up 50 cents/cwt than on Monday, according to regional hog dealers.

Hogs are plentiful, but packers will remain interested in buying them as long as their margins hold up and they are able to move product, a trader said.

Theopolis Waters reports on livestock markets for Reuters from Chicago.

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