By Theopolis Waters
CHICAGO, Nov 24 (Reuters) – Chicago Mercantile Exchange live cattle futures settled lower Monday, weighed down by profit-taking and fund liquidation, traders said.
December closed 1.400 cents per pound lower at 169.500 cents, and February off 2.125 cents at 170.025 cents.
Investors initially sold February and simultaneously bought December, which is known as bull spreads, following last Friday’s steady-to-better prices for market-ready or cash cattle.
Last week, some cash cattle in the U.S. Plains fetched as much as $174 per hundredweight (cwt), which surpassed the previous week’s record of $172.
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Packers who were short bought supplies despite plants scheduled to be closed at least one day for the Thanksgiving holiday, traders said.
Processors perhaps may again spend more for cattle as they buy for the first full week of production after Thanksgiving.
Investors also implemented bull spreads in response to Friday’s USDA monthly Cattle On Feed report that was considered mildly bearish for the February contract.
Friday’s report showed the number of cattle placed in U.S. feedlots last month slowed down versus a year ago, but not as much as expected.
Plant holiday shutdowns and grocers preparing to feature roasts and ribeyes after Thanksgiving should underpin wholesale beef prices in the near term, said analysts and traders.
Monday morning’s choice wholesale beef price was up $1.18 per cwt. from Friday to $256.40. Select gained 25 cents to $242.18, the USDA said.
Most thinly-traded CME feeder cattle contracts ended down the 3.000-cents per lb. daily price limit, pressured by live cattle market selling and fund liquidation.
January and March settled at 233.350 cents and 231.450 cents.
HOGS UP BUT OFF HIGHS
CME lean hogs closed firm on short-covering and fund buying that subsided as the session progressed given directionless fundamentals, a trader said.
December closed 0.675 cent per l.b higher at 91.325 cents, and February settled up 0.050 cent at 90.500 cents.
The average hog price in the eastern Midwest was down 46 cents per cwt. from Friday at $83.63, according to the USDA.
Separate government data showed the morning’s wholesale pork price gained 26 cents per cwt. from Friday to $93.65.
Some processors have sufficient supplies before Thanksgiving, while others are already purchasing animals for post-holiday production, an analyst said.
Pork demand could suffer when consumers grow weary of eating ham and turkey over the holiday, he said.
