Chicago | Reuters — Chicago Mercantile Exchange’s April and May feeder cattle futures hit fresh contract highs on Tuesday on tight supplies, as analysts said they expected cattle placements to continue to trend down, traders said.
Meanwhile, CME May lean hogs hit a contract low of 78.5 cents/lb., before closing down 2.175 cents at 78.825 cents/lb. (all figures US$).
Hog futures slipped on weak technicals, traders said, as the cash market continues to remain weak and premiums in the futures markets stay hefty.
“We’re seeing that cash market moving lower and lower,” said Don Roose, president of Iowa-based U.S. Commodities. “When you add the weakness on the export market, hogs are in a tough spot.”
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Meanwhile, the cattle market’s prices continue to rise on supply issues.
The U.S. Department of Agriculture, in monthly data due on Friday, is expected to report the number of cattle on feed as of April 1. It is expected to be down five per cent from a year earlier and placements of cattle into feedlots in March down 5.2 per cent, according to a Reuters’ analysts poll on Tuesday.
Meatpackers slaughtered an estimated 128,000 cattle on Tuesday, 2,000 fewer head than a week ago, USDA said.
Cash cattle markets continued to see steady to firm demand on Tuesday, traders said, with rising prices for feeder heifers, and steer and heifer calves in Oklahoma City.
Most-active CME May feeder cattle hit a contract high of 211.75 cents/lb. on the day, before settling up 0.75 cent at 211.5 cents/lb.
CME April feeder cattle futures settled up 0.375 cent at 205.925 cents/lb. Earlier in the session, it hit a contract high of 206.1 cents/lb.
April live cattle futures ended up 0.725 cent at 176.475 cents/lb., while June live cattle finished up 0.325 cent at 165.2 cents.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago.
