CHICAGO, June 16 (Reuters) – For a second straight session most Chicago Mercantile Exchange live cattle contracts finished in modest positive territory on Tuesday pegged to bear spreading and speculative buying, traders said.
The spreads consisted of traders who sold June futures ahead of its expiration on June 30 and simultaneously bought deferred months.
June closed down 0.125 cent per pound to 152.050 cents, August up 0.100 cent to 151.225 cents and October ended 0.150 cent higher at 153.650 cents.
Strong wholesale beef values provided futures support, while cash price uncertainty given more cattle for sale this week weighed on contracts.
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Tuesday afternoon’s wholesale Choice beef price jumped $2.14 per hundredweight (cwt.) from Monday to $249.47. Select cuts rose $2.10 to $242.56, the U.S. Department of Agriculture said.
Cash bids surfaced in Kansas at $150 per cwt, against at least $155 asking prices there and elsewhere in the U.S. Plains, feedlot sources said. Last week, cash cattle fetched $152 to $155.
Based on higher wholesale beef values, “I don’t know why anyone as a seller would be interested in selling cattle $2 lower,” said Livestock Marketing Information Center director Jim Robb.
Some packers may pay the same as last week for supplies as long as their margins improve and retailers top off beef inventories for Father’s Day, traders and analyst said.
On the other hand, 10,000 more cattle for sale this week, and a few processors cutting kills due to overall tight supplies, might pressure cash prices in parts of the Plains, they said.
Live cattle market advances stirred CME feeder cattle futures buying.
August ended 0.950 cent per lb. higher at 224.850 cents.
MIXED HOGS SETTLEMENT
CME lean hogs were pressured by lower cash prices, but supported by higher wholesale pork values, traders said.
July closed down 0.050 cent per lb. to 77.150 cents, and August up 0.075 cent to 75.550 cents.
USDA reported Tuesday afternoon’s average cash hog price in Iowa-Minnesota down 42 cents per cwt. from Monday to $77.63.
Separate government data showed the afternoon’s wholesale pork price at $86.03 per cwt., up $1.42 cents from Monday fueled by $6.03 higher pork bellies.
Packers have enough hogs for this week, while pork wholesalers conducted fill-in Father’s Day business, a trader said.
