Chicago | Reuters — Chicago Mercantile Exchange live cattle futures gained on Wednesday as boxed beef prices offered support ahead of the upcoming holiday weekend, traders said.
“It’s the main week for retailers to lock up their Labour Day supplies. That’s kept a floor under the cash market,” said Alan Brugler, president of Brugler Marketing.
CME benchmark October live cattle ended 0.95 cent higher at 110.825 cents/lb., while September feeder cattle gained 0.4 cent to end at 146 cents/lb.
Choice cuts of boxed beef climbed $2.20, to $223.06/cwt at midday, while select cuts increased by $1.10, to $205.75/cwt, according to the U.S. Department of Agriculture.
Gains were limited as traders anticipate large cattle placements in USDA’s Cattle on Feed report, due out Friday. A Reuters poll of 11 analysts showed July placements at 105.9 per cent, versus a year ago.
Cattle slaughter rates fell slightly from yesterday, with 119,000 head processed, still higher than a week and a year ago.
Beef packer margins reached $302.55 per head — the highest since June 17, according to Denver-based livestock marketing advisory service HedgersEdge.com.
Meanwhile, lean hog futures regained after the biggest drop in nearly two months yesterday.
CME October lean hogs settled 1.125 cents higher, at 52.55 cents/lb.
“Carcass weights are coming down,” said Brugler. “But we also know the fall runs are going to start hitting us pretty soon. So we better be current on slaughter or we’ll have trouble getting them all through the plants.”
Hog slaughter rates continue ahead of last year’s pace, with 484,000 head processed on Wednesday.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.