U.S. livestock: February live cattle lower on slaughter delays

Chicago | Reuters — CME live cattle futures eased on Thursday, as harsh cold conditions delayed slaughter operations, analysts said.

Summer month futures climbed to contract highs as traders anticipate lower cattle supplies, possibly exacerbated by icy conditions.

“We’re seeing those prices in April push through the roof. We now have a December that’s bitter cold – that does thin herds,” said Dan Hussey, senior market strategist at Zaner Group.

Benchmark CME February live cattle eased 0.4 cents, to 157.3 cents/lb. New life-of-contract highs were hit in June, August and October contract months.

January feeder cattle futures climbed 0.15 cents to 183.975 cents/lb.

Tyson Foods suspended and reduced operations at some U.S. meat facilities on Thursday as severe winter weather hits a vast stretch of the country.

Cattle slaughter dipped to 113,000 head, according to the U.S. Department of Agriculture. Packers are on pace to kill 459,000 head through Thursday, down 3.97 per cent from the same week a year ago.

USDA’s monthly cold storage report noted frozen beef stockpiles at 521.869 million lbs. as of Nov. 30, up two per cent from the previous month and up six per cent from last year.

In its monthly Cattle on Feed report due on Friday, USDA should peg November cattle placements 4.2 per cent lower than a year ago, according to a Reuters poll of analysts.

CME’s lean hog futures inched higher, but were capped as winter weather hampered hog processing operations in the Midwest.

“The weather is definitely what impacted the slaughter today. A lot of hogs are killed in Iowa, Minnesota,” said Austin Schroeder, commodity analyst at Brugler Marketing.

Hog slaughter rates dropped to 259,000 head, down 45.47 per cent from last Thursday’s 475,000 head, USDA said.

CME February lean hogs added 0.65 cents to end at 89.05 cents/lb.

USDA noted frozen pork supplies at 54.359 million pounds by Nov. 30, down 11 per cent from the previous month but up 13 per cent from last year.

— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.