May 5, 2017 / 8:02 PM / 6 months ago

LIVESTOCK-Profit-taking plunges CME live cattle by 3-cent limit

    * Feeder cattle sinks 4.5-cent limit
    * Lean hog contracts finish mixed

    By Theopolis Waters
    CHICAGO, May 5 (Reuters) - Chicago Mercantile Exchange
nearby live cattle futures on Friday finished down their 3-cents
daily price limit, hit by profit-taking after spiking this week
to new highs, said traders.
    Friday was the first of five days that funds in CME's
livestock markets that track the Standard & Poor's Goldman Sachs
Commodity Index           sold, or "rolled," June long positions
into deferred months.
    June         and August         closed at 128.300 and
121.175 cents per pound, respectively. Monday's limit will be
expanded to 4.500-cent.
    CME on Friday raised live cattle futures margins in response
to market volatility, said traders and analysts.             
    "Futures hit their tops after packers raced each other for
cattle. And you had some liquidation today, partly because of
the margin change requirement," said Vetterkind Cattle Brokerage
president Troy Vetterkind.
    Tight supplies and impressive wholesale beef demand
supported this week's $140 to $147 per cwt slaughter-ready, or
cash, cattle prices. Cash cattle last week brought $136 to $140.
    Robust U.S. exports and spring grilling-inspired beef cutout
values also helped drive up cash cattle returns.
    Friday morning's average wholesale beef price, or cutout,
climbed $2.19 per cwt to $237.77 from Thursday. Select cuts were
up $1.16 to $218.00, the U.S. Department of Agriculture (USDA)
    Friday's USDA monthly export data showed March total U.S.
beef exports at 234.0 million pounds, up 13.9 percent from
February and up 25.2 percent from a year earlier.
    CME feeder cattle dropped by its 4.500-cent limit following
live cattle futures' limit-down settlement. Monday's feeder
cattle limit will increase to 6.750 cents
    May         and August         feeders settled at 143.775
and 153.425 cents, respectively.
    This week's firmer cash and pork cutout values landed CME
May lean hogs above the 40-day moving average of 69.399 cents,
said traders. 
    They said CME's cattle market selloff and profit-taking
capped May hog futures gains and weighed on the June contract.
    Thinly-traded May         closed 0.400 cent per pound higher
at 69.400 cents. Most actively traded June         ended down
0.150 cent to 76.325 cents.
    Packers raised bids for supplies five sessions in a row as
supplies begin tapering off seasonally, said traders.
    Spring barbecues, brisk U.S. pork exports and increased
retail demand for Mother's Day meals supported the pork cutout
over the last six sessions, they said.
    Friday's USDA data showed March U.S. pork exports totaled
523.8 million pounds, up 16.3 percent from February and up 15.6
percent from a year ago. 

 (Reporting by Theopolis Waters; Editing by David Gregorio)

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