CHICAGO, Sept 6 (Reuters) – Chicago Mercantile Exchange
live cattle futures rallied on Wednesday to their highest level
in nearly four weeks, while feeder cattle also stormed higher.
U.S. cattle supplies are tight as drought reduced the amount
of pasture available for grazing and drove producers to send
more cattle to slaughter over the last year.
“The consumer is still buying beef at a faster pace than we
thought,” said Arlan Suderman, chief commodities economist for
brokerage StoneX. “We have rationed expert demand, but we have
not rationed domestic demand like we thought it would.”
October live cattle settled 2.750 cents higher at
182.700 cents per pound and touched their highest price since
Aug. 10.
Brokers said there were no confirmed cash cattle trades that
would have sparked the rally in futures.
There was unconfirmed talk of cash trades around $179 per
cwt in Kansas, which would have been firmer than the market was
expecting, Suderman said. Last week, cash cattle traded in
Kansas for around $178 per cwt.
Live cattle futures hit record highs this summer on supply
concerns but have been in a sideways trading pattern for weeks,
analysts said. Wednesday’s gains fueled some expectations the
market could make a breakout move to the upside.
“It’s still an overall sideways trend but we’re looking like
there’s potential for the market to retest the contract highs we
made in July,” said Doug Houghton, analyst for Brock Associates.
October feeder cattle ended up 2.175 cents at 256.475
cents per pound.
Boxed beef prices were lower, the U.S. Department of
Agriculture said, with choice cuts dropping $1.91 to $313.57 per
cwt and select cuts sliding $1.93 to $287.61 per cwt.
In the pork market, most-active October lean hog futures
ended down 1.3 cents at 81.875 cents per pound and
touched its lowest price in a week.
The USDA quoted the wholesale pork carcass cutout at $98.33
per cwt, down $0.54.
(Reporting by Tom Polansek in Chicago; Editing by Shailesh
Kuber)
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