Chicago | Reuters — Most Chicago Mercantile Exchange live cattle contracts gained modestly on Monday, supported by short-covering and futures’ discounts to last week’s cash prices, traders said.
Investors bought deferred contracts and simultaneously sold June ahead of its expiration on June 30, they said.
June closed down 0.275 cent per pound to 152.175 cents, August 0.325 cent higher at 151.125 cents and October up 0.3 cent to 153.5 cents (all figures US$).
Last week, market-ready (cash) cattle in the U.S. Plains fetched $152 to $155 per hundredweight (cwt) versus $155-$156 the week before, feedlot sources said.
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There are roughly 10,000 more cattle for sale this week compared to an increase last week of about 40,000 head, traders and analysts said.
Reduced kills and last-minute retail beef buying for Father’s Day might underpin beef cutout values, they said.
Monday morning’s wholesale choice beef price was up 38 cents/cwt from Friday to $246.10. Select cuts were down a penny to $240.41, the U.S. Department of Agriculture said.
For the week ending June 13, packers processed 10.6 per cent fewer cattle than a year ago, resulting in 8.5 per cent less beef.
Short-covering, back-month live cattle market advances and lower corn prices boosted CME feeder cattle contracts.
August ended 0.450 cent/lb. higher at 223.9 cents.
Hogs settle lower
CME lean hogs closed lower, as abundant supplies kept a lid on cash prices, traders said.
July closed 0.85 cent/lb. lower at 77.2 cents, and August down 1.25 cents to 75.475 cents.
Hog prices in the Midwest Monday morning were steady to down 50 cents/cwt, regional hog dealers said.
Last week’s hog slaughter climbed 11.2 per cent and pork output rose 10.3 per cent from a year earlier, based on USDA data.
The government quoted the morning’s wholesale pork price at $85.28/cwt, up 42 cents from Friday driven by $11.56 higher ribs.
“The industry could move a lot of product if we have good weather going into Father’s Day and retailers have to restock for the long July 4 holiday,” said JBS Trading Co. president James Burns.
Investors bought July and at the same time sold August, which dropped the contract to its lowest level since March 24.
Deferred-month selling reflected investor caution that USDA’s quarterly hog report on June 26 might show more hog production than anticipated.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.
