Chicago | Reuters – Chicago Mercantile Exchange live cattle futures closed higher and reached a new contract high on Wednesday amid concerns about tightening U.S. supplies, brokers said.
Strong recent gains have left the market technically overbought and due for a setback, brokers said.
“We’ve had a nice rally here,” said Matt Wiegand, commodity broker for FuturesOne. “We’re set up for a short-term correction.”
Most actively traded December live cattle LCZ2 ended 0.275 cent higher at 153.575 cents per lb. February live cattle LCG3 closed up 0.325 cent at 157.025 cents and set a contract high of 157.075 cents.
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CME November feeder cattle FCX2 ended 0.900 cent higher at 178.825 cents per lb, while January feeders FCF3 closed up 1 cent at 181.250 cents per lb.
A monthly U.S. Department of Agriculture cattle report, issued last Friday, confirmed there were 1% fewer of the animals in feedlots at the start of the month, compared to a year earlier. Placements of cattle into feedlots during September were down 4 per cent from a year earlier, the report said.
In the pork sector, firm cash hog prices helped boost futures, brokers said.
December lean hog futures LHZ2 crept 0.050 cent higher to close at 88.500 cents per lb. February hogs LHG3 rose 0.325 cent to 91.00 cents per lb and hit their highest price since Sept. 21.
The USDA quoted the U.S. pork carcass cutout value at $97.74 per cwt, down $0.75 from Tuesday.
On Thursday, traders will review weekly USDA data on pork and beef exports.
