CHICAGO, May 6 (Reuters) – Chicago Mercantile Exchange live cattle futures on Friday stretched their consecutive win streak to six sessions, helped by optimism for cash prices by late afternoon that offset stagnant wholesale beef demand, traders said.
June live cattle closed 1.100 cents per lb higher at 120.725 cents, and August ended up 0.475 cent at 117.900 cents.
On Friday, bids surfaced for market-ready, or cash, cattle in the U.S. Plains at $119 per cwt and quickly escalated to $124, steady with last week’s sales.
“Packers just need cattle,” said a feedlot source who is asking $126 for his livestock.
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The choice beef price, or cutout, Friday morning was $203.66 per cwt, down 76 cents from Thursday and select cuts dropped 59 cents to $194.91. Both slid more than $8 from last week, according to U.S. Department of Agriculture data.
Beef at wholesale continues to suffer due to abundant supplies of meat protein, said analysts.
They look for beef demand to improve when supermarkets buy more product to feature for the U.S. Memorial Day holiday on May 30, the unofficial start of the summer grilling season.
Most CME feeder cattle contracts closed firm, supported by live cattle market gains while higher corn prices weighed on the May trading month.
May finished 0.575 cent per lb lower at 147.375 cents. August ended up 0.150 cent at 147.175 cents, and September ended 0.375 cent higher at 146.050.
CME lean hogs bowed to profit-taking and the huge drop in wholesale pork values that may pressure cash prices, traders said.
Thinly traded May closed down 0.775 cent per lb at 76.800 cents. Most-actively traded June ended 1.050 cents lower at 81.275 cents.
Wednesday morning’s wholesale pork price, or cutout, at $78.73 had fallen $4.39 per cwt from Tuesday, hit by the nearly $24 retreat in pork belly prices, according to USDA data.
“Belly demand may have fallen out of bed because there is enough product out there. But I’m waiting to see what the price looks like on the government’s afternoon report,” a trader said.
