Chicago Mercantile Exchange (CME) live cattle futures turned moderately higher on Wednesday, lifted by short-covering following mostly fully steady cash prices, traders and analysts said.
April live cattle closed 0.55 cents per pound higher at 127.975 cents. June was up 0.375 cent to 123.2 cents (all figures US$).
Cash cattle in the U.S. Plains generally traded at $128 to $129 per hundredweight (cwt), fully steady compared with last week, said feedlot sources. Some cattle in Texas fetched $128, which was steady to up $3 from last week, a feedlot manager said.
“Packers needed supplies for this week. But mixed beef prices and poor margins kept them (packers) from getting too aggressive about owning cattle,” a trader said.
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The U.S. Department of Agriculture on Wednesday showed the average price for wholesale choice beef up six cents/cwt to $191.48; select cuts slipped 61 cents to $188.61.
U.S. beef packer margins on Wednesday were at a negative $27.75 per head versus a negative $31.05 on Tuesday and a negative $14.50 a week ago, according to HedgersEdge.com
CME feeder closed weaker as corn prices edged upward, which could limit feedlot demand for younger cattle.
April feeder cattle settled down 0.175 cent per pound to 144.55 cents. May ended 0.525 cent lower at 146.575
cents.
Hogs rally with cash
Hog futures moved higher after packers raised cash bids to ensure themselves of supplies for the rest of the week’s slaughter, analysts and traders said.
On Wednesday USDA quoted the average price for hogs at the most-watched Iowa/Minnesota market at $79.01 cents/cwt, up $1.61.
Futures’ premium to CME’s lean hog index at 75.94 cents limited advances, a trader said. Lacklustre pork demand discouraged some futures buyers, he added.
The wholesale price for pork on Wednesday dipped 11 cents/cwt to $76.95, according to USDA.
Spot April hogs closed at 81.325 cents, up 0.375 cents. Most actively traded June was 0.625 cent higher at 92.475 cents.
— Theopolis Waters writes for Reuters from Chicago.
