By Theopolis Waters
CHICAGO, Nov 13 (Reuters) – Chicago Mercantile Exchange live cattle futures settled higher Thursday in anticipation of steady or better prices for slaughter-ready or cash cattle this week, traders said.
December closed 2.175 cents per pound higher at 169.925 cents, and February at 171.025 cents per lb. up 1.450 cents.
Packers may have to compete for cattle based on futures’ rally, said David Hales, author of the Hales Cattle Letter.
Cash cattle bids developed in Kansas at $165 per hundredweight (cwt), with no response from sellers, said feedlot sources. Cash cattle last week moved at mostly $167.
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As the harvest in southern Alberta presses on, a broker said that is one of the factors pulling feed prices lower in the region. Darcy Haley, vice-president of Ag Value Brokers in Lethbridge, added that lower cattle numbers in feedlots, plentiful amounts of grass for cattle to graze and a lacklustre export market also weighed on feed prices.
Reuters could not confirm talk of a possible $170 per cwt. cash trade in Iowa. That would be $3 higher than last week and even with the record high set three weeks ago.
A few processors need to replenish inventories after buying sparingly in recent weeks. And gradually recovering margins may encourage some packers to spend at least steady money for supplies.
Funds trading CME livestock at times sold December long positions and mostly bought February in a procedure known as the “roll” by followers of the Standard & Poor’s Goldman Sachs Commodity Index.
Thursday was the final day for the roll process.
CME feeder cattle drew support from buy stops and live cattle market gains.
The surge in corn prices kept a lid on the November feeder cattle contract.
November closed unchanged at 239.350 cents per lb. January ended 0.850 cent higher at 234.225 cents, and March 1.025 cents higher at 232.825 cents.
HOGS CLOSE HIGHER
CME lean hogs ended higher on buy stops and fund buying, traders said.
December closed up 0.600 cent per lb. at 91.275 cents, and February 0.800 cent higher at 91.600 cents.
Weak cash hog and wholesale pork prices slowed futures advances.
USDA data quoted Thursday morning’s average hog price in the western Midwest down 17 cents per cwt from Wednesday at $86.00.
Separate government data showed the morning’s wholesale pork price had dipped 19 cents per cwt from Wednesday to $95.09.
Some packers have near-term inventory needs met, while others are buying to make up for plants closed during the Veterans Day holiday.
