U.S. livestock: Live cattle rally on stronger Plains cash market

Chicago | Reuters — Chicago Mercantile Exchange live cattle futures climbed to fresh three-month highs on Friday as firming beef packer bids at U.S. Plains feedlot markets fueled expectations of higher cash cattle sales this week.

Tighter supplies of market-ready cattle on feedlot showlists this week helped to support the cash market. Trading later developed near the futures market close.

“The market rallied all week anticipating higher cash trade,” said Midwest Market Solutions president Brian Hoops.

“Feedlots really had a bullish mentality with the smaller cattle numbers and the fact that packers were short-bought so they priced the showlists accordingly,” he said.

Feedlot cattle traded in Kansas and Texas at $129-$130/cwt, up from $125 to mostly $126 a week earlier, according to trade sources.

Several weeks of harsh winter weather in the Plains had slowed cattle weight gains, which limited slaughter-ready supplies for packers.

Those cattle, however, will ultimately reach market weight in the coming weeks. That, traders said, weighed on deferred futures contracts.

CME February live cattle ended up 0.825 cent/lb. at 130.1 cents. Actively traded April gained 0.4 cent to 127.65 cents and June rose 0.075 cent to 118.675 cents.

Feeder cattle futures closed narrowly mixed, with prices anchored by cash market headwinds as demand for feeders is slowing seasonally.

March feeders were down 0.1 cent/lb. at 149.725 cents while April futures rose 0.1 cent to 152.4 cents.

CME lean hog futures declined on technical selling and pressure from easing cash market prices.

Cash hogs in the closely followed Iowa and southern Minnesota market dropped by 41 cents/cwt on Friday.

Actively traded CME April lean hogs settled 1.575 cents/lb. lower at a 4-1/2 month low of 68.15 cents after failing at midweek to break above chart resistance at their 200-day moving average. May futures were 0.975 cent lower at 74.925 cents.

— Karl Plume reports on agriculture and agribusiness for Reuters from Chicago.

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