CHICAGO (Reuters) — Chicago Mercantile Exchange live cattle futures on Wednesday settled up sharply, supported by slaughter-ready or cash prices that hit all-time highs, traders said.
Cash cattle in Kansas and Texas moved at mostly $158 per hundredweight, topping last week’s record by $3, according to feedlot sources.
Feedlots were reluctant to sell their animals at a loss given profitable packer margins and brisk demand for beef at a time when it tends to slow down this time of year.
“Traders are scratching their heads because it appears the seasonals no longer apply,” said K&S Financials analyst Jack Salzsieder.
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Cash cattle prices garnered more support as packers bought animals for the first full week of slaughters after the U.S. July Fourth holiday.
Wednesday afternoon’s wholesale price for choice beef was at $247.66 per cwt, down 47 cents from Tuesday. Select beef reached $240.12, besting Tuesday’s record, based on U.S. Department of Agriculture data.
Investors are tracking Tropical Storm Arthur churning toward the East Coast that could soak holiday barbecue meat business.
CME livestock markets will close at noon on Thursday for Friday’s U.S. holiday.
August live cattle finished 0.825 cents per lb higher at 152.325 cents, and October up 0.600 cents to 155.675 cents.
CME feeder cattle marked a new high, driven by strong live cattle futures and weak corn prices.
August closed up 0.425 cent per lb to 216.200, and September 0.550 cent higher at 217.550 cents.
CME July and August hogs finished weak, pressured by their premiums to the exchange’s hog index at 127.51, traders said.
They said higher cash hog and wholesale pork values limited August future’s losses and helped lift October.
USDA data showed the afternoon’s average hog price in the Iowa/Minnesota market climbed $1.77 per cwt from Tuesday to $128.65, USDA said.
The government data showed the wholesale pork price turned $2.53 per cwt higher from Tuesday to $133.17.
While some packers are rounding off inventories for the rest of the week, others with plants closed on Friday’s holiday booked hogs into early next.
Investors are watching the East Coast storm that could disrupt hog production in the region.
Meanwhile, supermarkets are buying small amounts of pork after purchasing most of what they need for holiday grilling promotions.
Speculators bought deep-deferred CME hogs with the view the deadly pig virus on U.S. farms will reduce hog supplies beginning this fall.
July hogs closed 0.250 cent per lb lower at 130.800, and August down 0.075 cent to 130.350 cents. October finished up 0.950 cent to 115.100 cents, and December 1.200 cents higher at 101.050.
