CHICAGO, June 1 (Reuters) – Chicago Mercantile Exchange live cattle futures finished mixed on Wednesday after the morning’s higher wholesale beef prices prompted traders to buy the June contract and simultaneously sell August, traders said.
June live cattle closed up 0.325 cent per lb to 121.425 cents, and August ended 0.600 cent lower at 117.450 cents.
The choice beef price, or cutout, at $222.74 per cwt Wednesday morning, rose $1.40 from Tuesday. Select cuts were up 54 cents to $201.91, the U.S. Department of Agriculture said.
Some traders and analysts contended that beef prices have bottomed out and would now start to rise as supermarkets and restaurants buy supplies for Father’s Day on June 19.
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But one trader said more than one day is needed to confirm that an upward trend in beef values has begun.
Hefty packer margins, the morning’s beef price upturn and processors needing cattle for the first full week after the Memorial Day holiday fueled talk of steady to higher cash prices by week’s end.
Last week, packers paid $122 to $126.50 per cwt for market-ready, or cash, cattle.
The average beef packer margin for Wednesday was estimated at a positive $93.25 per head, up from a positive $78.85 on Tuesday and $46.03 a week ago, as calculated by HedgersEdge.com.
Profit-taking and initial technical selling weighed on CME feeder cattle contracts. August finished 0.675 cent per lb lower at 146.425 cents.
HIGHER HOG MARKET CLOSE
Technical buying and strong wholesale pork prices boosted CME lean hogs, traders said.
Spot June closed 0.575 cent per lb higher at 81.150 cents, and July ended up 1.350 cents to 82.800 cents.
Wednesday morning’s wholesale pork price was up $1.01 from Tuesday to $85.36 per cwt, according to USDA.
Grocers are restocking meat cases after Memorial Day and for Father’s Day advertisements, traders said.
They said most packers filled inventories through early next week, but others wanted to buy hogs to take advantage of their highly profitable margins.
Cash hog prices in the Midwest Wednesday morning were steady to 50 cents per cwt lower, said regional hog dealers.
