Chicago | Reuters — Chicago Mercantile Exchange live cattle futures closed higher on Wednesday as the market consolidated just below life-of-contract highs touched a day earlier.
Tightening U.S. cattle supplies remain a supportive backdrop to the market, but fresh bullish news was lacking, traders said. Wholesale beef prices fell, extending a seasonal slide dating from the Labour Day holiday, and cash cattle markets were quiet, offering little direction.
CME October live cattle futures settled up 1.1 cents at 186.775 cents/lb. but stayed below Tuesday’s contract high of 187.45 cents, and most-active December ended up 1.05 cents at 191.525 cents, keeping below Tuesday’s high of 192.05 cents (all figures US$).
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October feeder cattle futures settled up 1.225 cents at 260.575 cents/lb., shrugging off pressure from an uptick in feed corn futures.
The choice boxed beef cutout was down 86 cents on Wednesday at $301.26 per hundredweight (cwt), its lowest reading since May, U.S. Department of Agriculture (USDA) data showed.
Traders have begun squaring positions ahead of USDA’s monthly Cattle on Feed report due Friday. Analysts surveyed by Reuters on average expect the government to report the number of cattle in U.S. feedlots as of Sept. 1 at 11.023 million head, down 2.3 per cent from a year ago, and placements into feedlots during August were seen down 6.4 per cent from a year ago.
Lean hog futures ended higher on Wednesday, supported by the front contract’s discount to the CME lean hog index. October lean hogs settled up 0.925 cent at 85.775 cents/lb., below the latest index of 86.58. Most-active December hogs ended up 1.975 cents at 78.225 cents/lb.
USDA quoted the wholesale pork carcass cutout late Wednesday at $99.22/cwt, down $1.91 from Tuesday.
Market players await USDA’s weekly export sales report due on Thursday and the government’s quarterly Hogs and Pigs report on Sept. 28.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
