Chicago | Reuters — Chicago Mercantile Exchange live cattle contracts were weakened Friday by profit-taking and investor caution as they await the bulk of this week’s cash cattle sales, said traders.
Futures discounts to initial cash prices limited market losses, they said.
June closed down 0.125 cent/lb. to 131.25 cents, and August down 0.175 cent at 123.85 cents (all figures US$).
Nebraska’s market-ready, or cash, cattle on Friday sold lightly at $136-$136.50, steady to $1.50 lower than a week ago there, said feedlot sources.
They said packer bids for other cattle in the U.S. Plains were $134-$135/cwt against $140-$142 asking prices.
A few animals at Thursday’s Fed Cattle Exchange, on average, brought $136.75/cwt. Last week’s average top price at the exchange was $132.17.
Processors might pay steady-to-better prices for supplies than last week as long as their margins and wholesale beef demand hold up, an analyst said.
He said tight cattle supplies emboldened feedlots to hold out for more money for their animals.
Beef demand is expected to diminish the closer retailers come to finalizing Father’s Day meat purchases.
Short-covering and this week’s sharply higher cash feeder cattle prices lifted CME feeder cattle futures.
August feeders ended up 0.225 cent/lb. higher at 154.175 cents.
Hogs extend gains
CME lean hogs gained for a second straight day, with the aid of buy stops and traders that bought hog futures and simultaneously sold live cattle contracts, said traders.
They said Friday morning’s soft cash and wholesale pork prices capped market advances.
June, which will expire on June 14, closed 0.45 cent per pound higher at 82.475 cents. Most actively-traded July finished 0.5 cent higher at 82.7 cents.
A few packers may have lowered cash bids after they bought enough hogs for near-term production, traders and analsyts said.
They said tightening seasonal supplies might again force some processors to compete for hogs next week.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.Tagged beef demand, cash cattle, cattle futures, closing markets, CME, Fed Cattle Exchange, feeder cattle, hog futures, lean hogs, live cattle