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LIVESTOCK-CME live cattle futures gain on firmer beef prices
September 6, 2017 / 8:50 PM / 3 months ago

LIVESTOCK-CME live cattle futures gain on firmer beef prices

    * Feeder cattle ends higher
    * Most hog contracts rise

    By Theopolis Waters
    CHICAGO, Sept 6 (Reuters) - Chicago Mercantile Exchange live
cattle futures settled moderately higher on Wednesday, with help
from short-covering and improved wholesale beef values, said
traders.
    December received added support from fund buying after the
contract topped the 10-day moving average of 109.648 cents.
    October         live cattle finished up 0.275 cent per pound
at 104.700 cents, and December         closed 0.425 cent higher
at 109.800 cents.
    Some grocers bought beef to avoid shortages after plants
closed on Monday for the U.S. Labor Day holiday, traders and
analysts said.           
    A trader, however, said beef demand tends to struggle after
Labor Day - the last grilling holiday of the summer - and as
consumers focus more on buying items to get their children
settled into classrooms.
    "The market may want to see if cash prices can stabilize
before making any further moves on the futures end," said
Allendale Inc. chief strategist Rich Nelson.
    Market participants awaited this week's sale of
market-ready, or cash, cattle in the U.S. Plains that last week
brought $103 to $105 per cwt.
    Bullish traders believe packers will pay at least $105 per
cwt for supplies given better wholesale beef prices and
extremely profitable packer margins.        
    Contrarians point to ample supplies of slaughter cattle at
heavier weight, which tends to pump more meat into the retail
sector.          
    Technical buying and live cattle futures advances pulled up
CME feeder cattle contracts.
    September         closed 1.250 cents per pound higher at
143.300 cents.
   
    MOSTLY FIRMER HOG FUTURES
    The bulk of CME lean hog contracts finished in slightly
bullish territory.
    In a trading strategy known as bear spreading, investors
bought deferred months and simultaneously sold October futures
following lower cash and wholesale pork prices.         
        
    October         ended down 0.200 cent per pound to 63.550
cents. December         finished up 0.100 cent to 60.275 cents,
and February         closed up 0.175 cent to 64.725 cents.
    Hog numbers remain seasonally abundant and the end of the
summer bacon-lettuce-tomato sandwich season continues to drag
down wholesale pork prices, a trader said.
    Bullish investors were also concerned about the U.S.
government's weekly data that showed increased hog weights,
which makes more product available to retailers, said Nelson.
    However, he said pork demand could get a boost from grocers
looking to feature more product during National Pork Month in
October.

 (Reporting by Theopolis Waters; Editing by David Gregorio)
  

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