U.S. livestock: CME live cattle end session weaker

(Photo courtesy Canada Beef Inc.)

Chicago | Reuters — Chicago Mercantile Exchange live cattle finished lower on Wednesday on year-end profit taking, trader said.

However, futures extended their yearly winning streak to six in a row after finishing up 23 per cent for 2014 amid tight supplies after years of drought, an analyst said.

Upward-trending wholesale beef prices and stronger-than-expected prices for market-ready or cash cattle lifted futures from session lows.

On Wednesday, cash cattle in Kansas moved at $166 to $166.50 per hundredweight (cwt), $4.50 higher than last week, feedlot sources said (all figures US$). Cash cattle in Nebraska fetched $166 to $168/cwt, up as much as $6 from a week ago, they said.

Futures’ recent rally and robust beef demand boosted cash prices.

The morning’s choice wholesale beef price climbed $1.50/cwt from Tuesday to $248.70. Select jumped $2, to $238.74, according to the U.S. Department of Agriculture.

Packers are short bought supplies for the first full week after the Christmas and New Year’s holidays.

Grocers are booking beef to avoid potential supply shortages after packing plants shut down periodically during the winter holidays.

December live cattle, which expired at noon CT, closed down 0.175 cent per pound to 165.7 cents, and February was 1.15 cents lower at 163.55 cents.

CME feeder cattle drew support from sharply lower corn prices and live cattle market buying.

Feeder cattle contracts also posted their 6th consecutive yearly increase and gained 32 percent this year.

January closed up 1.125 cents/lb. at 219.45 cents, and March was 1.075 cents higher at 217.325 cents.

Hogs end mixed

CME hogs were supported by anticipation of cash hog prices bottoming out soon but pressured by the steep drop in wholesale pork values, traders said.

Hog futures dropped 4.9 per cent for the year.

February closed up 0.025 cent/lb. to 81.2 cents, and April down 0.15 cents to 83.275 cents.

On Wednesday morning, slaughter hogs in the U.S. Midwest traded steady with Tuesday’s prices, according to regional hog dealers.

USDA data showed the morning’s wholesale pork price had fallen $2.39/cwt from Tuesday to $84.34 on lower costs for all categories.

Some packers are working through ample supplies following holiday plant closures, a trader said.

Grocers are buying pork on an as-needed basis until they can clear inventories over the New Year’s holiday, he said.

— Theopolis Waters reports on livestock futures markets for Reuters from Chicago.

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