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10 months ago
LIVESTOCK-Cattle extends gains on technical buying, hogs at 14-year low
October 17, 2016 / 9:11 PM / 10 months ago

LIVESTOCK-Cattle extends gains on technical buying, hogs at 14-year low

By Michael Hirtzer
    CHICAGO, Oct 17 (Reuters) - U.S. live and feeder
 cattle futures climbed more than 1 percent on Monday,
adding to gains in the previous session, on technical buying and
expectations cattle and beef prices will rise seasonally,
traders and analysts said.
    Chicago Mercantile Exchange lean hog futures fell
sharply. Friday's expiration of October hogs left
December futures as the front-month contract and it was
trading at the lowest levels for a lead month since 2002.
    Both cattle and hogs have been under pressure for months by
bigger U.S. herds and abundant meat supplies, with cattle
futures benefiting from technically oversold conditions after
reaching six-year lows last week.
    "The cattle market is once again searching for a bottom.
We've been in an extended downtrend for two years, and the
markets have to come up for air," said Cassandra Fish, an
analyst and author of blog The Beef.
    CME December live cattle futures gained 1.550 cents
to 99.000 cents per lb while CME November feeder cattle 
finished 1.575 cents higher at 117.225 cents per lb. 
    Cash cattle markets have been trending lower with futures
and traders waiting to see if slaughter-weight steers and
heifers would attract higher prices than the mostly $98 per cwt
fetched last week in the southern U.S. Plains. 
    More than 13,000 head of cattle were expected to be offered
this week on the online Fed Cattle Exchange scheduled for
Wednesday, according to the auction website, and price direction
on the online auction could impact futures. 
    Additionally, beef prices typically begin rising around this
time of year as retailers start stocking meat coolers for the
holidays. More demand from retailers could force some packers to
pay higher prices to feedlots, boosting futures.
    The U.S. Department of Agriculture showed choice-grade beef
and wholesale pork prices each slightly higher in data released
after the close of futures trading.     
    Fish said hog supplies were likely to continue expanding.
"Everybody knows we are heading into increased supply. November
hog kills are historic for being the largest of the year, and
this year is no exception."
    December lean hogs settled 0.625 cent lower at 41.600 cents
per lb, just above their life-of-contract low of 41.100 reached
on Oct. 5.


 (Reporting by Michael Hirtzer in Chicago; Editing by Matthew
Lewis)

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