August 3, 2018 / 9:04 PM / 9 months ago

LIVESTOCK-Cattle futures rise on better beef packer demand

    By Michael Hirtzer
    CHICAGO, Aug 3 (Reuters) - Chicago Mercantile Exchange live
cattle futures         rose sharply on Friday, lifted by better
demand from beef packers who were bidding more aggressively to
buy steers in cash markets, traders and analysts said.
    Technical buying also supported cattle futures, which broke
out of a relatively narrow trade that had defined the market for
a few weeks.
    CME October live cattle        gained about 2 percent or
2.050 cents to settled at 112.000 cents per pound, finishing
above its 200-day moving average for the first time in months.
Front-month August live cattle        gained 2.075 cents to
110.675 cents.
    Live cattle prices extended more modest gains at midmorning
after talk circulated that several major beef packers raised
cattle bids to $110 per cwt, up from $109 earlier this week.
    "Futures began to take off," said Archer Financial Services
broker Dennis Smith.
    After the close of futures trading, feedlots started to sell
cattle to packers at mostly $114 per cwt, up from trades a week
ago of $112. Fears earlier this week of lower cash trades had
weighed on the futures market.         
    CME September feeder cattle futures        were up 1.675
cents to $153.025 cents.
    Lean hog futures         were mostly higher, with several
contracts including most-active October hogs        surging on
short-covering after prices tumbled to contract lows earlier in
the session.
    October hog futures finished up 1.125 cents to 50.775 cents.
    News that Mexico and the United States could reach a NAFTA
deal next week helped to trigger the short-covering, as did news
that China had culled 1,000 hogs because of the country's first
outbreak of African swine fever.                          
    Both Mexico and China imposed tariffs on imports of U.S.
pork as part of the simmering trade war with the United States.
    "Those two items were enough," Smith said of the China and
Mexico news. "We were oversold and discounted, and that brought
in some good buying."

 (Reporting by Michael Hirtzer)
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