CHICAGO, April 10 (Reuters) - Chicago Mercantile Exchange live cattle futures were mixed on Tuesday as the spot contract rose on its discount to the cash market while deferred months drifted lower under heavy supplies of cattle, traders said.
CME April live cattle closed up 0.775 cent per pound at 112.800 cents, edging up ahead of the contract’s end-of-month expiration when it aims to converge with a cash market that last week traded in the 116- to 118-cent-per-pound range.
June cattle fell 0.400 cent to 102.100 cents.
“The April has to respect the cash market more than the back (months) do,” said Alan Brugler, president of Brugler Marketing & Management.
“We know overall that ready numbers are rising, the finished numbers coming out of the feedlots have been going up from now into June,” he said.
Packers will be buying cattle from larger showlists at U.S. Plains feedlots this week, with some early-week bids reported to be around $116 per cwt, said Rich Nelson, chief strategist with Allendale Inc.
Wholesale beef prices fell on Tuesday, with choice cuts down $1.53 per cwt and select cuts off $1.81.
The U.S. Department of Agriculture lowered its second-quarter U.S. beef production estimate in a monthly report on Tuesday due to a lower slaughter and lighter cattle weights, but raised its third-quarter slaughter forecast. The agency also cut its cattle price forecast due to plentiful supplies.
Feeder cattle futures were also mixed, with April settling up 0.375 cent per pound at 134.825 cents and May down 0.250 to 135.275 cents.
Lean hog futures ended higher in nearby contracts and lower in deferred months as hefty supplies of animals weighed prices. The market, however, was probing for a bottom following a recent steep decline to 16-month lows.
The USDA raised its first-quarter pork production estimate for the United States but reduced its outlook for the remainder of the year due to a slower slaughter pace. It also cut pork exports due to an expected drop in demand from China, which has threatened to impose import duties on U.S. pork amid an ongoing trade dispute.
April hogs settled up 0.600 cent per pound at 53.500 cents. May futures were 0.125 cents higher at 67.450 cents and June finished 0.825 cents lower at 75.050 cents. (Reporting by Karl Plume; editing by Diane Craft)