May 24, 2017 / 8:54 PM / 6 months ago

LIVESTOCK-CME live cattle retreat following initial cash prices

    * Feeder cattle ends down sharply
    * Lean hogs finish mostly weaker

    By Theopolis Waters
    CHICAGO, May 24 (Reuters) - Chicago Mercantile Exchange live
cattle contracts slumped on  Wednesday, pulled down by technical
selling and lower preliminary cash prices, said traders.
    June         closed 0.950 cent per pound lower at 122.125
cents. August         closed 1.400 cents lower at 119.925 cents,
and below the 10-day moving average of 120.130 cents.
    Wednesday morning's Fed Cattle Exchange sale yielded an
average top price of $132.54 per cwt, down for last week's
$135.16 average high.
    Market-ready, or cash, cattle in Texas and Kansas later
trickled in at $132 per cwt, compared to $133 to $134 in the
region a week ago, said feedlot sources. Remaining feedlots in
the U.S. Plains held out for at least $136.
    The Memorial Day holiday-shortened workweek reduced the
number of animals needed by packers, despite their good margins
and tight cattle supplies, traders and analysts said.
    They said beef demand may suffer when grocers begin
featuring more pork at the conclusion of National Beef Month in
    Wednesday morning's average wholesale beef price was up 18
cents per cwt to $245.92 from Tuesday. Select cuts fell 82 cents
to $220.35, the U.S. Department of Agriculture said.
    The average beef packer margins on Wednesday were a positive
$142.10 per head, up from a positive $121.65 last week, as
calculated by
    Some investors adjusted positions in advance of Friday's
USDA monthly Cattle-On-Feed report.            
    Technical selling and live cattle futures liquidation sank
CME feeder cattle.
    May         feeders, which will expire on Thursday, settled
down 0.250 cents per pound at 144.000 cents. Most
actively-traded August         ended 2.825 cents lower at
148.675 cents.

    The bulk of CME lean hogs finished in negative territory,
pressured by profit-taking after contracts peaked at new highs
earlier in the session, said traders.
    They said investors sold deferred months and bought the June
contract in a trading strategy known as bull spreads.
    June         closed up 0.050 cent per pound to 80.200 cents.
July         finished 0.175 cent lower at 79.850 cents, and
August         down 0.050 cent to 79.850 cents.
    Market participants resisted buying futures knowing packers
require fewer hogs with plants scheduled to close on Monday, a
trader said.
    He said grocers are buying less pork as they wait to see how
much product sold over the three-day holiday weekend.
    However, Archer Financial Services broker Dennis Smith
expects cash hog and wholesale pork values to soon move higher
as supplies decline seasonally.

 (Reporting by Theopolis Waters; Editing by David Gregorio)

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