By Theopolis Waters
CHICAGO, March 24 (Reuters) – Chicago Mercantile Exchange live cattle nearby contracts gained modestly, while back months eased, ahead of what turned out to be a neutral U.S. government monthly Cattle-On-Feed report.
Friday’s report showed one percent fewer cattle placed in feedlots in February than a year ago, nearly matching analysts’ average estimates.
April live cattle closed up 0.325 cent per pound to 122.100 cents, and June up 0.050 cent to 112.850 cents.
August was down 0.100 cent to 107.800 cents, and October 0.325 cent lower at 107.275 cents.
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Analysts said Friday’s neutral USDA cattle report shifts investor focus to cash and wholesale beef prices.
After the report, packers paid $130 per cwt. for cash cattle in the southern U.S. Plains, up $2 from last week in the region, said feedlot sources.
And Friday afternoon’s average wholesale beef price fell 66 cents per cwt to $221.62 from Thursday. Select dropped 22 cents to $215.55, the USDA said.
Tight packer supplies and profitable, but slipping, packer margins supported cash prices, said analysts and traders.
Grocers were reluctant to buy beef at current prices given ample supplies, they said.
USDA estimated this week’s cattle slaughter at 613,000 head, 25,000 more than a week ago.
CME feeder cattle mimicked mixed live cattle futures.
March feeder cattle ended down 0.325 cent per pound to 133.375 cents, and April up 0.225 cents to 135.575 cents.
HOG FUTURES FALL
Lean hog futures on Friday suffered their biggest one-day loss in a month, with pressure from liquidation by funds that were largely responsible for Thursday’s market rally, said traders.
April hogs ended 2.075 cents per pound lower at 67.275 cents, and May was 1.725 cents lower at 72.225 cents.
“Futures are still definitely at the high-end of cash market expectations,” said Livestock Marketing Information Center director Jim Robb.
Slaughter-ready, or cash, hogs slipped for a second straight day with Friday’s average Iowa/Minnesota price at $66.07 per cwt., down 98 cents from Thursday, the U.S. Department of Agriculture said.
Packers resisted paying more for hogs at higher prices that, along with inconsistent wholesale pork values, shaved their margins.
Friday’s average pork packer margins were a positive $17.85 per head, down from a positive $23.25 last week, as calculated by HedgersEdge.com.
Investor caution before USDA’s March 30 quarterly hog report further pressured futures.
