Chicago | Reuters — Chicago Mercantile Exchange live cattle futures closed higher on Monday, helped by short covering and futures’ discounts to last week’s cash prices, traders said.
April live cattle closed 0.825 cent/lb. higher at 125.55 cents, and June ended 1.95 cents/lb. higher at 116.6 cents (all figures US$).
Last week, market-ready, or cash, cattle in the U.S. Plains fetched $125 to $128/cwt, compared with $133 to $136 the week before, said feedlot sources.
Friday’s mildly bullish U.S. Department of Agriculture monthly cattle and cold storage reports encouraged futures buyers.
USDA’s monthly Cattle on Feed report last Friday showed fewer cattle placed in feedlots in March than a year ago.
“The Cattle on Feed report simply was not as bearish as so many people were expecting. And there wasn’t any reason to beat them (futures) up,” said independent livestock futures trader Dan Norcini.
Friday’s government monthly cold storage report showed last month’s total beef inventory at 466.9 million lbs., down five per cent from February and down three per cent from a year ago.
April feeder cattle, which will expire on Thursday, closed 1.925 cents/lb. lower at 146.025 cents. May ended up 0.8 cent at 143.25 cents, and August ended 1.15 cents higher at 143.25 cents.
Cash feeder cattle prices that fell as much as $4/cwt weighed on CME April feeder cattle futures.
Remaining feeder cattle contracts followed CME’s live cattle market higher.
Lower hog market settlement
CME lean hog futures’ premiums to the exchange’s hog index for April 21 at 67.68 cents pressured contracts, traders said.
Thinly traded May ended 0.775 cent/lb. lower at 74.925 cents, and most-active June finished down 0.375 cent at 78.45 cents.
Investors eyed the morning’s cash price in Iowa/Minnesota at $65.72/cwt, $1.59 lower than on Friday in extremely light volume, based on the government’s direct hog market report.
Regional hog dealers quoted cash hog prices in the Midwest Monday morning at steady to up 50 cents/cwt from Friday.
“We’ll keep grinding about 50 cents higher in the near term because it’s that time of year when the numbers (supplies) tighten up,” a Midwest hog dealer said.
Dealers and analysts said a stretch of warm, dry weather is needed for barbecuing in order to drive cutout prices higher.
Monday morning’s wholesale pork, or cutout, price at $80.14/cwt was up 38 cents from Friday, according to USDA data.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.Tagged cattle futures, closing markets, CME, feeder cattle, hog futures, lean hogs, live cattle