By Theopolis Waters
CHICAGO, Dec 19 (Reuters) – Chicago Mercantile Exchange live cattle futures ended higher on Friday, amid short-covering and positioning before the U.S. Department of Agriculture’s monthly Cattle-On-Feed report.
Analysts called the report neutral for futures because the data was nearly in line with expectations.
Sluggish wholesale beef demand and uncertainty regarding prices for unsold market-ready or cash cattle at times slowed advances.
This week, a small number of cash cattle sold in the U.S. Plains at $156 to $157 per hundredweight (cwt).
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The Choice wholesale beef price plunged early on Friday by $3.12 per cwt. from Thursday to $238.83. Select slipped 19 cents to $230.13, based on USDA data.
Packers are handcuffed by their poor margins and the inability to sell high-priced beef to retailers, an analyst said.
Processors need fewer cattle due to plant closures over the Christmas and New Year’s holidays.
Feedlots are holding out for more money following futures’ recent rally, traders and analysts said.
December live cattle closed 2.050 cents per pound higher at 160.750 cents, and February up 1.575 cents to 160.100 cents.
CME feeder cattle ended sharply higher with support from weak corn prices and live cattle market advances.
January closed up 3.075 cents per lb. to 220.150 cents, and March ended 4.200 cents higher at 217.975 cents.
HOGS MODERATELY LOWER
CME hogs settled slightly lower, weighed on by softer wholesale pork values and downward-trending prices for slaughter-ready or cash hogs, traders said.
February closed up 0.025 cent per lb. to 81.900 cents, April at 83.200 cents, 0.025 cent weaker, and May 0.275 cent lower at 87.175 cents.
Slaughter hog prices in Midwest fell by as much as $2 per cwt., according to hog dealers in the region.
USDA quoted the morning’s wholesale pork price at $86.43, down 95 cents per cwt. from Thursday, with all categories lower except loins.
Packers have sufficient inventories through the Christmas holiday as farmers truck hogs to market ahead of schedule to avoid lower prices, an analyst said.
Grocers are booking small amounts of meat until they can determine how much product sold over the year-end holidays, he said.
USDA will issue the monthly cold storage report on Monday at 2 p.m. CST to include November total pork and beef inventories.
Analysts, on average, forecast pork and beef stocks totaled 497.9 million lbs and 386.2 million lb., respectively.
