Chicago | Reuters — U.S. feeder cattle and live cattle futures hit their highest prices since August on Thursday, supported by strength in the cash market, before ending mixed.
Cash cattle had set the firmer tone on Wednesday, trading for $101/cwt in Texas and Kansas, up from a range of $97-$100 in Texas last week and $99-$100 in Kansas last week, according to traders (all figures US$).
The increase was a turnaround after cash prices and futures tumbled when a fire at a Tyson Foods slaughterhouse in Kansas in August removed a major buyer from the market.
“The tone sounds like it’s getting better,” a cattle futures trader said.
October feeder cattle futures reached their highest price since Aug. 9 at the Chicago Mercantile Exchange (CME) before closing up 0.525 cent at 138.925 cents/lb.
October live cattle futures traded up to 100.625 cents/lb., their highest price since Aug. 27, before retreating. The contract closed down 0.575 cent at 99.8 cents/lb.
The setback came as some traders were disappointed with a lack of new cash cattle trades.
“We’re dealing with a market where you continually need to see the higher trade,” a trader said.
Boxed beef cutout prices dropped by seven cents/cwt for choice cuts and rose by 19 cents/cwt for select cuts, according to the U.S. Department of Agriculture.
In the pork market, lean hog futures ended mostly higher at the CME.
Traders generally expect China to increase meat imports as it struggles with an outbreak of African swine fever, a fatal pig disease that has devastated the Chinese hog herd.
China bought 782 tonnes of U.S. pork from Sept. 6-12, USDA said, down from 10,878 tonnes a week earlier. Total U.S. net pork export sales were 14,200 tonnes for 2019, down 35 per cent from the previous week and 34 per cent from the prior four-week average.
“You’re still seeing pricing on the expectations for better exports coming forward,” said Matt Wiegand, commodity broker for FuturesOne.
China auctioned 10,000 tonnes of pork from state reserves on Thursday to secure meat supply during the National Day holiday, the country’s commerce ministry said, after African swine fever recently drove prices to record highs.
October lean hog futures set a one-week low and ended down 1.525 cents at 61.4 cents/lb. December lean hog futures rose 0.15 cent to 67.95 cents/lb. Other deferred contacts also settled firmer.
— Reporting for Reuters by Tom Polansek in Chicago.