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LIVESTOCK-Cash price unease pressures CME live cattle futures
February 16, 2017 / 10:02 PM / 10 months ago

LIVESTOCK-Cash price unease pressures CME live cattle futures

    * Feeder cattle ends weaker
    * Hog market finishes lower

    By Theopolis Waters
    CHICAGO, Feb 16 (Reuters) - Chicago Mercantile Exchange live
cattle futures on Thursday slipped for a second straight day,
amid investor caution while waiting for remaining cash cattle to
change hands by Friday, said traders.
    Short-covering and futures' discounts to early-week cash
returns provided downside market support, they said.
    February live cattle         closed down 0.250 cent per
pound to 116.525 cents, and April         0.100 cent lower at
113.250 cents.
    The bulk of animals sold on Wednesday's Fed Cattle Exchange
brought $118.50 to $119.25, compared with last week's $117.50
    Slaughter-ready, or cash, cattle bids elsewhere in the U.S.
Plains stood at $116 per cwt against $122 asking prices, said
feedlot sources. Last week, Plains' cash cattle fetched $119 to
    Cattle traders are weighing futures' supportive discount to
cash prices against bearish poor packer profits and readily
available cattle, said Oak Investment Group president Joe
    Furthermore, funds in CME's live cattle market continue to
hold large long positions, and although the beef cutout improved
on Thursday, "it's still not good," said Ocrant.
    Thursday morning's average wholesale beef price, or cutout,
jumped 93 cents per cwt to $189.27 from Wednesday. Select cuts
rose 75 cents to $187.90, the U.S. Department of Agriculture
    Thursday's reduced USDA cattle and hog slaughter estimates
may reflect packer cutbacks because of their poor margins and
some plant workers who stayed home for the "Day Without
Immigrants" protests, said traders and analysts.             
    Thursday's average beef packer margins were at a negative
$80.75 per head, down from negative $69.20 a week ago, as
calculated by
    Profit-taking and live cattle futures weakness undercut CME
feeder cattle contracts. 
    March feeders         closed 0.450 cent per pound lower at
123.825 cents.
    CME hogs stumbled on technical selling and profit-taking
following the morning's lower wholesale pork values, traders
    April         closed 0.950 cent per pound lower at 69.825
cents, and May         0.825 cent lower at 74.700 cents.
    USDA data on Thursday morning showed the average wholesale
pork price dropped 88 cents per cwt to $84.60 from Wednesday,
mostly led by $3.75 lower pork bellies.
    Bacon slicers and other end-users are less likely to store
more bellies at current prices, particulary with more fresh
bellies becoming available in the coming months, a trader said.
    Packers paid more for hogs amid tight near-term supplies and
in preparation for a Saturday slaughter close to 200,000 head,
said Midwest hog merchants.

 (Reporting by Theopolis Waters; Editing by Jonathan Oatis)

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