By Theopolis Waters
CHICAGO, Aug 5 (Reuters) – Chicago Mercantile Exchange live cattle settled mixed on Wednesday after investors bought the August contract and sold deferred months prompted by the morning’s wholesale beef price increase, traders said.
Spot August futures closed 0.450 cent per pound higher at 148.675 cents, and October was down 0.025 cent at 148.175 cents.
Wednesday morning’s wholesale Choice beef price, or cutout, rose $1.84 from Tuesday to $235.32 per hundredweight (cwt.). Select cuts were up 93 cents to $229.10, the U.S. Department of Agriculture said.
Typically, the turnaround following the summer seasonal slump in beef demand occurs around early August when supermarkets plan for Labour Day grilling specials.
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“Any cash bids over $149 should move the world,” a feedyard manager said.
Packers in the U.S. Plains bid $145 to $147 per cwt for market-ready, or cash, cattle against sellers asking mostly $151 to $153, feedlot sources said.
Cash feeder cattle rose as much as $4 and that helped lift the August CME feeder cattle contract, while profit-taking and firm corn prices pressured remaining trading months.
August finished up 0.175 cent per lb. at 214.125 cents, September slipped 0.125 cent to 210.700 and October closed 0.250 cent lower at 208.525 cents.
HOGS DROP WITH FUNDAMENTALS
CME lean hogs bowed to soft cash hog and wholesale pork prices, traders said.
Spot August futures, which will expire on Aug. 14, closed 1.175 cents per lb. lower at 80.225 cents, and most-active traded October 0.575 cent lower at 66.775 cents.
On Wednesday morning, the average cash hog price in Iowa-Minnesota sagged $1.41 per cwt. from Tuesday to $74.48, the USDA said.
Wednesday morning’s wholesale pork price was at $88.48 per cwt., down nine cents from Tuesday, according to USDA.
Supplies are sufficient enough for this week’s production, even though a few packing plants plan to increase Saturday’s kill to make up for time off during Monday’s floater holiday, a trader said.
Packer margins greatly benefited from cheaper hogs and periodic pork cutout price spikes.
Pork processor margins for Wednesday were at a positive $20.80 per head, compared with a positive $18.45 on Tuesday and a positive $15.98 a week ago, as calculated by HedgersEdge.com.
