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LIVESTOCK-Bearish USDA report rattles CME live cattle futures
May 26, 2017 / 8:21 PM / 7 months ago

LIVESTOCK-Bearish USDA report rattles CME live cattle futures

    * Feeder cattle fall almost 3 percent
    * Hog contracts climb to fresh highs
    * CME livestock markets closed on Memorial Day

    By Theopolis Waters
    CHICAGO, May 26 (Reuters) - Chicago Mercantile Exchange live
cattle futures on Friday finished sharply lower, hit by fund
liquidation and the morning's bearish U.S. Department of
Agriculture Cattle-On-Feed report, said traders.
    The report showed the number of cattle placed in feedlots in
April hit a 14-year high for the month.             
    Traders said fund liquidation and diminished wholesale beef
demand contributed to CME live cattle's heavy losses.
    CME's livestock markets will be closed on Monday for the
U.S. Memorial Day holiday.
    June         ended 1.225 cents per pound lower at 122.700
cents, and August         2.450 cents lower at 118.950 cents.
Both contracts finished below their respective 10-day moving
averages of 122.893 and 120.020 cents.
    Futures tumbled after the cattle report's bearish April
placement result, said Oak Investment Group President Joe
Ocrant. But some still may consider futures' discount to cash
prices a buying opportunity, he said.
    Packers this week paid $132 to $133 per cwt for
slaughter-ready, or cash, cattle that last week ago brought $133
to $134.
    Processors purchased fewer cattle for next week with plants
scheduled to shutdown on Monday's holiday, the unofficial start
of the summer grilling season.
    Some processors avoided bidding up for supplies as National
Beef Month in May winds down, allowing grocers to feature more
pork and chicken.
    Friday morning's average wholesale beef price dropped 67
cents per cwt to $245.44 from Thursday. Select cuts fell 70
cents to $218.28, the USDA said.
    CME feeder cattle tumbled almost 3 percent on profit-taking,
technical selling and live cattle futures' selloff.
    August feeders         ended 4.175 cents per pound lower, or
down 2.6 percent, to 146.950 cents.

    Investors sold CME live cattle and simultaneously bought the
exchange's hog futures, which helped drive them to fresh
contract highs, said traders.
    They said sentiment over tightening seasonal supplies and
grocers featuring more pork in the weeks ahead generated
additional futures buying.
    June         closed 0.875 cent per pound higher at 81.825
cents, and marked a new high of 81.875 cents. July        
finished 1.325 cents higher at 81.900 cents, and hit a fresh
high of 82.025 cents.
    Friday morning's average cash hog price in Iowa/Minnesota
was $71.67 per cwt in light volume, $1.78 lower than on
Thursday, USDA said.
    U.S. government data on Friday morning showed the average
wholesale pork price was up 49 cents per cwt from Thursday to

 (Reporting by Theopolis Waters; Editing by James Dalgleish)

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