Chicago | Reuters — Chicago Mercantile Exchange cattle futures were mixed on Wednesday, as beef packer margins stayed in the red and cash cattle prices were expected to be steady to higher, traders said.
Hog futures were also mixed on the day. February and May lean hog futures dipped to new contract lows on sluggish demand and seasonal low prices, analysts said.
Traders said they are also awaiting the U.S. Department of Agriculture’s monthly Cattle on Feed report, due Friday.
Analysts surveyed by Reuters expect the government to report the number of cattle in U.S. feedlots as of Oct. 1 at 11.42 million head, slightly down from a year ago. Cattle marketed in September are expected to be down nearly 10 per cent from a year earlier.
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The U.S. Department of Agriculture said meat processors slaughtered an estimated 126,000 cattle on Wednesday, steady from a week ago, but lower than a year ago.
Meanwhile, beef packer margins were a negative $40.55 a head on Wednesday, which was less of a loss per animal than Tuesday, and less of a loss than a week earlier (all figures US$). Separately, USDA reported Wednesday morning that prices of wholesale choice and select boxed beef cuts were up.
“The packers are a little stand-offish right now for bidding things up, given that they’re losing more than $40 per animal,” said Don Roose, president of brokerage U.S. Commodities.
Feeder cattle futures slipped as traders kept a sharp eye on rising corn prices, amid questions if the feed grain had put in harvest lows.
CME December lean hog futures ended up 0.475 cent at 68.025 cents/lb.
CME December live cattle futures settled up 0.325 cent at 187.2 cents/lb.
November feeder cattle futures ended 0.725 cent lower at 249.725 cents/lb., while most-active January feeder cattle settled down 1.9 cents at 250.9 cents/lb.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago.
