Chicago | Reuters — U.S. cattle futures closed higher on Monday, buoyed by Friday’s supportive monthly Cattle on Feed report, rising wholesale beef prices and strength on Wall Street tied to hopes for a COVID-19 vaccine, traders said.
“All of the above (suggest) optimism for the meat market,” said Jason Roose, analyst and broker with Iowa-based U.S. Commodities.
Chicago Mercantile Exchange February live cattle futures settled up 2.25 cents, about two per cent, at 112.9 cents/lb. (all figures US$).
The February contract gapped higher at Monday’s open after the U.S. Department of Agriculture late Friday reported smaller numbers of U.S. cattle on feed as of Nov. 1, and fewer cattle placed in feedlots during October, than analysts had expected on average.
“The last couple cattle-on-feed reports showed big placements, but this one had less,” Roose said.
Wholesale beef prices continue to rise. Choice cuts were up $3.25 on Monday afternoon at $241.60/cwt, the highest since June. Select cuts were up $2.50 at $217.48, according to USDA data.
CME January feeder cattle settled up 3.225 cents at 137.825 cents/lb.
Lean hog futures rose on short-covering and spillover strength from the cattle market. February lean hogs settled up 1.775 cents at 67.125 cents/lb.
After Monday’s close, USDA reported Oct. 31 stocks of frozen U.S. pork bellies at 19.684 million lbs., down 21 per cent from last month and down 57 per cent from last year.
Total pounds of beef in freezers totaled 500.473 million pounds, up eight per cent from the previous month and up seven per cent from last year, USDA said.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.