U.S. livestock: Cattle futures firm as cash market rebound seen

Hog report expected to show smaller herd

Chicago | Reuters — U.S. live cattle futures rose for the third day in a row on Friday, on expectations that the cash market would rebound from recent lows in the coming days.

Traders also viewed a government report that showed cattle placements during November were down sharply from a year earlier as bullish.

“The market is forward looking and pricing better times ahead, at least in part due to the slowing placement pace,” brokerage StoneX said in a note to clients.

Hog futures also were firm after two straight days of declines as traders staked out positions ahead of the U.S. Agriculture Department’s quarterly inventory report.

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Chicago Mercantile Exchange (CME) February live cattle futures settled up 0.4 cent at 114.85 cents/lb. (all figures US$). The contract hit resistance at the high end of its 20-day Bollinger range.

January feeder cattle dipped 0.575 cent to 140.4 cents/lb.

The choice boxed beef cutout fell 88 cents, to $208.63/cwt, on Friday, according to USDA. Select cuts rose 57 cents to $194.27/cwt.

CME February lean hogs rose 0.3 cent to settle at 65.8 cents/lb.

A monthly USDA report on Friday afternoon showed that amount of cattle placed on feed during November was down nine per cent from a year ago. That was slightly lower than market expectations for 8.6 per cent.

The amount of cattle on feed as of Dec. 1 was in line with trade forecasts.

USDA’s Hogs and Pigs report that will be released on Dec. 23 was expected to show the U.S. hog herd likely decreased by one per cent in the September-November quarter from a year earlier.

— Mark Weinraub is a Reuters commodities correspondent in Chicago.

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