January 17, 2018 / 11:36 PM / 4 months ago

LIVESTOCK-CME live cattle futures jump on short-covering

    By Julie Ingwersen
    CHICAGO, Jan 17 (Reuters) - Chicago Mercantile Exchange
cattle futures surged on Wednesday on technical buying and
short-covering, spurred in part by higher-than-expected prices
at a weekly cattle sale, traders said.
    Animals at Wednesday's Fed Cattle Exchange brought $119.75
per cwt, up from $119 a week earlier.
    "I guess people thought it would be closer to $118, so when
they got basically steady prices, shorts covered," said Mark
Gold of Top Third Ag Marketing.
    However, packer bids for slaughter-ready, or cash, cattle
elsewhere in the U.S. Plains were $117 to $118 per cwt, compared
to asking prices of $122 to $123.
    Bulls look for steady to firmer cash prices based on a
four-day climb in futures prices and fewer cattle for sale than
last week. They also believe that recent frigid weather in the
Plains slowed animal weight gains, making cattle less available
to packers when they need them.
    Bears contend that tepid wholesale beef demand and increased
supplies ahead will pressure near-term cash prices.    
     
    CME February         live cattle futures finished up 2.875
cent per pound at 120.975 cents after climbing the daily 3-cent
limit to 121.300 cents. April         ended up 2.400 cent at
122.775 cents.
    Technical buying accelerated as the February contract pushed
above its 20-, 30- and 100-day moving averages.    
    CME feeder cattle futures rose, following the live cattle
market. Most-active March         feeder cattle closed 2.050
cents per pound higher at 145.975 cents.    
    
    LEAN HOG FUTURES RETREAT
    February lean hog futures        closed lower on
profit-taking a day after recording a contract high.
    Additional pressure stemmed from lower morning cash hog
prices as packers attempted to improve their profit margins.
    Wednesday's hog kill, at 444,000 head versus 460,000 a week
ago, suggests wintry weather in the Eastern Corn Belt disrupted
pork production. During periods of cold weather, farmers
typically are reluctant to open up swine buildings and risk
losing heat. Treacherous driving conditions can also complicate
the movement of hogs and employees to plants.
    February         hogs settled down 1.175 cents per pound at
72.725 cents. April         ended 0.625 cent lower at 75.525
cents.

 (Additional reporting by Theopolis Waters; Editing by James
Dalgleish)
  
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