CHICAGO, Oct 8 (Reuters) – Chicago Mercantile Exchange live cattle rose for third straight session Thursday, helped by more short-covering following a morning jump in wholesale beef quotes, traders said.
Spot October finished 1.825 cents per lb higher at 131.175 cents, and December up 1.525 cents at 137.675.
Thursday morning’s wholesale choice beef price, or cutout, climbed $1.39 per cwt from Wednesday to $204.97. Select cuts were up 30 cents to $198.00, the U.S. Department of Agriculture said.
Investors are expecting beef demand to improve, usually around mid-October, as retailers buy for November features, said a trader, adding, “as beef goes, so goes cash.”
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Traders and analysts look for the bulk of market-ready, or cash, cattle to change hands on Friday.
Cash cattle bids in Kansas and Texas were at $118 per cwt versus asking prices over $127, feedlot sources said. Last week, cash cattle in the U.S. Plains brought mostly $118 to $124.
Cash and beef prices are about to bottom out as packers come closer to cleaning up a recent surplus of heavyweight cattle, the traders and analysts said.
Fund buying contributed to December and February advances after they surpassed their respective 20-day moving averages of 136.54 and 137.69 cents.
CME feeder cattle futures settled in positive territory for a third day in a row, lifted by weak corn futures, technical buying and live cattle futures purchases.
October feeder cattle ended 2.925 cents per lb higher at 187.875 cents.
HOGS END UP SLIGHTLY
Lean hogs at the CME drew strength from sharply higher wholesale pork prices as supermarkets fill immediate needs for October Pork Month, traders said.
They said weaker cash prices in the midst of a seasonal increase in hog supplies limited futures gains.
Spot October closed up 0.175 cent per lb to 74.000 cents, and December ended 0.175 cent higher at 66.150 cents.
USDA quoted the morning’s wholesale pork price at $88.95 per cwt, up $2.02 from Wednesday, led by a $3.55 surge in loin costs.
The government quoted Thursday morning’s average cash hog price in the Iowa/Minnesota market at $71.63 per cwt, $1.27 lower than on Wednesday in light volume.
October, which will expire on Oct. 14, and deferred contracts benefited from their discounts to the exchange’s hog index for Oct. 6 at 74.075 cents.
