Chicago | Reuters — CME Group feeder cattle futures rose on Friday, bolstered by falling corn futures.

March feeder cattle gained five cents to settle at 144.15 cents, adding 9.575 cents for the week — a 7.1 per cent gain as corn fell 5.8 per cent, its biggest drop since the week ending March 20, 2020 (all figures US$).

CME’s live cattle futures also gained, though the U.S. Department of Agriculture’s monthly Cattle on Feed report, released after markets closed, showed higher than expected feedlot placements in December.

“We are, at this very moment in January, seeing the feed relationship impact brand new placements,” said Rich Nelson, chief strategist at Allendale Inc. “Lower placements in January, and probably February, will lighten up the September, August and November finished cattle supply.”

As of Jan. 1, USDA reported December cattle feed placements at 101 per cent compared to a year ago, above trade estimates of a three per cent drop.

CME April live cattle futures ended 2.575 cents higher at 122.525 cents/lb., adding 4.325 cents for the week.

In addition to fewer placements, Nelson anticipates seeing carcass weights fall as feed costs pressure producers to move cattle through the feedlot more quickly.

“We might be turning the corner on excess weights and overfed heavyweight cattle still out in the country,” he said.

Boxed beef cutout values continue to strengthen, with select cuts gaining for a seventh consecutive session, adding $3.06/cwt, to $213.34, and choice cuts adding $1.62, to $222.82/cwt, according to USDA.

Lean hog futures also gained on the plummet in corn prices. CME’s most-active April lean hogs adding 2.25 cents to close at 76.15 cents/lb., while the spot February contract added 1.825 cents to end at 69.925 cents/lb.

For the week, April lean hogs added 3.5 cents, a 4.8 per cent increase, its biggest since the week ending Sept. 11, 2020.

— Reporting for Reuters by Christopher Walljasper in Chicago.