By Theopolis Waters
CHICAGO, Jan 2 (Reuters) – Lightly-traded Chicago Mercantile Exchange feeder cattle on Friday climbed two percent, their biggest daily increase in seven months, led by live cattle market advances, traders said.
Fund buying and buy stops surfaced after January and March surpassed their respective 20-day moving average of 221.46 cents and 218.46 cents.
January closed up the 4.500-cents per pound daily price limit at 223.950 cents, and March ended 4.125 cents higher at 221.450 cents.
LIVE CATTLE RALLY
CME live cattle futures turned up sharply, which wiped out Wednesday’s losses, sparked by futures’ discounts to this week’s cash prices, traders said.
Read Also
U.S. grains: Soybeans pressured by lack of Chinese demand; corn rises on export sales
Chicago soybean futures came under pressure on Thursday on a lack of Chinese demand for the U.S. oilseed while corn futures ticked higher on strong export sales data, analysts said.
February live cattle closed up 2.125 cents per lb. to 165.675 cents, and April was 2.175 cents higher at 164.575 cents.
This week, slaughter-ready or cash cattle in the northern U.S. Plains sold at $166 to $169 per hundredweight, as much as $7 higher than a week ago, feedlot sources said.
Short-bought packers spent more for cattle while passing that cost on to grocers who are gearing up to feature beef in January, traders and analysts said.
After a seven-day upward trend, Friday morning’s Choice wholesale beef price dropped 90 cents per cwt. from Wednesday to $248.00. Select rose eight straight days to $238.97, up 40 cents from Wednesday, U.S. Department of Agriculture said.
Traders are keeping tabs on wintry weather poised to sweep into parts of the Midwest by Saturday.
Freezing rain and snow will make it difficult to truck livestock to market. And, frigid temperatures beginning early next week could slowdown cattle weight gains.
HOGS SHRUG OFF EARLY SELLING
CME lean hogs drew support from buy stops and live cattle market advances that pared initial hog futures weakness, traders said.
February closed up 0.100 cent per lb. to 81.300 cents, and April 0.225 cent higher at 83.500 cents.
Packers lowered cash bids until they can work through ample supplies after closing plants during the New Year’s holiday, which limited futures gains, an analyst said.
Supermarkets are buying pork sparingly until they can clear product left unsold over the holiday, he said.
Friday morning’s average price for hogs in the Iowa-Minnesota market was at $72.95 per cwt, $2.92 lower than on Wednesday, according to USDA.
USDA data showed the morning’s wholesale pork price had slipped 63 cents per cwt from Wednesday to $83.77, led by $4.19 lower costs for loins.
