Chicago | Reuters — Chicago Mercantile Exchange live cattle futures climbed for a fourth consecutive session on Wednesday, with December up the three-cent/lb. price limit, as the southern Plains braces for a weekend winter storm that drove cash and wholesale beef prices higher, traders said.
Spot December settled limit up at 128.6 cents/lb. (all figures US$). February closed 2.875 cents higher, at 134.675 cents.
Live cattle’s trading limit will be expanded to 4.5 cents on Thursday.
Inclement weather usually slows down animal weight gains while making it difficult to move livestock to packing plants.
Retailers probably stocked up on beef to avoid being short of product due to the storm and reduced plant operations during the Christmas and New Year’s holidays, said independent livestock futures trader Dan Norcini.
This week, market-ready (cash) cattle in the U.S. Plains sold at $122 to $124/cwt, as much as $6 above last week’s prices, feedlot sources said.
Wednesday morning’s wholesale choice beef price jumped $2.80/cwt from Tuesday, to $194.33. Select cuts surged $3.52, to $187.17, based on U.S. Department of Agriculture data.
Short-covering on the last full trading day for the year provided more support to the live cattle market that experienced decreased volume as some investors prepare for extended year-end holiday vacations.
Fund buying developed after February cracked the 40-day moving average of 132.43 cents.
CME feeder cattle mimicked live cattle future’s four-day win streak. January feeders ended up 4.425 cents/lb. higher at 163.075 cents.
Hog futures rise before report
CME lean hogs settled higher as traders adjusted positions before USDA’s quarterly hog report on Wednesday at 2 p.m. CT.
Hog contracts drew more support from live cattle market buying, despite plentiful hog supplies that weakened cash hog and wholesale pork values, traders said.
Spot February closed 0.925 cent/lb. higher at 57.775 cents, and April 0.875 cent higher at 63.675 cents.
Cash hogs in the Midwest on Wednesday morning traded mostly 50 cents/cwt lower, said regional buyers.
The morning’s wholesale pork price dropped 71 cents/cwt from Tuesday to $70.69, USDA said.
Packer inventories are full through the rest of the year, cash hog buyers said.
A trader said grocers held off buying significant amounts of pork until determine how much of it moved over the Christmas holiday.
— Theopolis Waters reports on livestock markets for Reuters from Chicago.