Chicago | Reuters—Chicago Mercantile Exchange (CME) live and feeder cattle futures ticked higher on Thursday on a spree of bargain buying as industry players believed cattle futures were oversold, analysts said.
Live and feeder cattle futures had set multiple life-of-contract lows during the previous session and had taken a steep dive on Tuesday.
“I don’t know if there’s anything fundamental driving the market. At the end of summer, volume is light and it doesn’t take much to swing the cattle market,” Altin Kalo, economist at Steiner Consulting Group, said.
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Hogs also gained after stronger-than-expected export sales left some investors scrambling to cover short positions.
Low corn prices, a key component of livestock feed, have also helped support cattle futures, analysts said. Corn futures have remained under heavy pressure from a major crop tour that is reinforcing expectations for a bumper U.S. crop.
Most-active October feeder cattle FCV24 finished 2.575 cents higher at 234.25 cents per pound. CME most-active October live cattle LCV24 closed up 1.275 cents at 175.9 cents per pound.
Beef and pork cutout values increased for nearly all cuts, according to U.S. Department of Agriculture data.
Beef packer margins have lifted into the black following weeks of lingering in the red, according to data from HedgersEdge.
Analysts noted that demand for cheaper cuts of beef, such as ground beef and chuck steaks, has remained strong, while demand for more expensive cuts has weakened.
Meanwhile, restaurant demand for beef is slowing during a seasonal lull.
CME October lean hog futures LHV24 ended up 3.475 cents to 79.625 cents per pound.
