By Theopolis Waters
CHICAGO, Feb 24 (Reuters) – Chicago Mercantile Exchange live cattle finished mostly lower on Monday in response to Friday’s bearish U.S. Department of Agriculture monthly cattle report, traders said.
Friday’s data showed a bigger than expected jump in the number of cattle placed in feedlots last month as high prices for market-ready cattle encouraged feedyards to bring in more young calves for fattening.
The spot February contract, which will expire on Feb. 28, benefited from Monday’s beef cutout bounce and last week’s strong cash cattle prices, traders said.
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Monday morning’s wholesale choice beef price, or cutout, rose $2.03 per hundredweight from Friday to $215.78. Select cuts jumped $2.28 to $213.16.
On Friday, the bulk of cash cattle in Texas and Kansas fetched $144 to $145 per cwt., up $2 to $3 from the previous week, feedlot sources said.
Cash cattle in Nebraska last week averaged $146.75, $3.75 higher than the previous week, according to the USDA.
Packers were short-bought supplies, despite cutting slaughter rates to recover lost margins and drive up wholesale beef prices.
June bore the brunt of Friday’s losses as traders simultaneously sold that contract and bought April futures, a trader said.
February live cattle closed up 0.600 cent per pound to 145.150 cents. It hit a new contract high of 145.400 cents in electronic trading.
April ended down 0.225 cent at 141.225 cents, and June finished at 132.075 cents, 0.650 cent lower.
CME feeder cattle for March delivery dropped on lower prices for cattle at local markets.
Other feeder cattle contracts drew support from weak old-crop Chicago Board of Trade corn prices.
March ended down 0.500 cent per lb. to 170.200 cents. April finished at 171.625 cents, 0.425 cent higher, and May closed up 0.100 cent to 172.325 cents.
MOST HOGS GAIN ON SPECULATIVE BUYING
Profit-taking following mixed rather than higher cash prices pressured April CME hogs, while speculative buying lifted the remaining contracts, traders said.
The morning’s average hog price in the western Midwest direct market sank $4.77 per cwt. to $88.27, but rose 72 cents to $89.01 in the eastern region, based on USDA data.
Earlier on Monday, cash prices in the Midwest market traded steady to higher $2 per cwt. amid tight supplies, according to hog dealers.
They said bitterly cold temperatures in parts of the Midwest this week could delay the delivery of hogs.
Anticipation of reduced supplies as the Porcine Epidemic Diarrhea virus, which is fatal to baby pigs, spreads on U.S. farms lifted some deferred hog contracts to new highs, traders said.
April hogs settled at 99.250 cents per lb., down 0.100 cent. It spiked to a new contract high of 99.800 cents.
June finished at 108.125 cents, up 0.100 cent. July closed up 0.100 cent to 107.650 cents and posted a new high of 107.800 cents.
