Chicago | Reuters — U.S. live cattle futures firmed for a second straight day on Thursday on bargain buying and speculative buying after prices hit 2-1/2 week lows earlier this week.
Futures firmed despite lower cash cattle prices and tumbling beef prices as packer demand held stable and processing margins remained profitable.
“With the early week dip, cattle got a little oversold. We’ve been able to keep the packing pace up pretty well given what’s going on with COVID and that’s helped to buttress futures a little,” said Matthew Wiegand, broker with FuturesOne.
“Even with the boxed beef dropping pretty sharply, the packers are still making money.”
Chicago Mercantile Exchange (CME) February live cattle futures ended 0.875 cent higher at 111.85 cents/lb. (all figures US$). January feeder cattle rose 0.575 cent, to 137.6 cents/lb.
The choice boxed beef cutout tumbled $3.67, to $214.59/cwt, on Thursday, while choice cuts fell $3.18, to $198.47/cwt, according to the U.S. Department of Agriculture (USDA). Both were the lowest in a month.
Lean hog futures retreated on Thursday after two days of gains, keeping prices largely range-bound.
Benchmark CME February lean hogs fell 1.175 cents to 65.1 cents/lb. The contract broke through chart support at its 100-day moving average and closed below the key technical level.
The composite pork carcass cutout rose 83 cents on Thursday to $78.43/cwt, holding within a roughly $3.50 range since mid-November.
— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago.