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LIVESTOCK-CME live cattle futures rise before USDA report
October 20, 2017 / 6:56 PM / a month ago

LIVESTOCK-CME live cattle futures rise before USDA report

    * Feeder cattle settles firmer
    * Lean hog market extends gains
    * USDA cattle report at 2 p.m. CDT

    By Theopolis Waters
    CHICAGO, Oct 20 (Reuters) - Chicago Mercantile Exchange live
cattle closed higher on Friday, helped by short-covering and
positioning before the U.S. Department of Agriculture's monthly
Cattle-On-Feed report on Friday at 2 p.m. CDT (1900 GMT), said
traders.             
    They said that with December futures slated to be the new
lead month following October's expiration, investors
periodically sold December and simultaneously bought the
February contract.
    October         live cattle, which will expire on Oct. 31, 
finished up 0.475 cent per pound to 111.675 cents.
    Most actively traded December         closed 0.450 cent
higher at 116.600 cents. February         ended 0.625 cent
higher at 121.275, and above the 10-day moving average of
121.153 cents.
    Investors factored in what could be $110 to $111 per cwt
paid by packers for slaughter-ready, or cash, cattle in the U.S.
Plains this week after sales conclude late on Friday, said
traders and analsyts. Cash cattle last week brought $111.
    Packers resisted paying up for cattle, a move that in recent
weeks reduced their margins. Near-term beef wholesale beef
demand still face challenges during the rest of October Pork
Month along with year-end holiday ham and turkey promotions.
                  
    USDA will issue the monthly cold storage report on Monday at
2 p.m. CDT that will include September total beef and pork
inventories.
    A survey of analysts, on average, projected last month's
total beef stocks at 500.2 million pounds and 596.0 million for
pork.
    Weaker corn prices and live cattle futures gains supported
CME live cattle.
    October         ended up 0.475 cent per pound to 153.625
cents.

     HOG FUTURES UP 3RD STRAIGHT DAY 
     CME lean hog futures rose for a third day in a row on
short-covering and Friday morning's wholesale pork price
rebound, said traders.
     They said CME hogs garnered more support from buy stops and
speculative buying, despite futures' premiums to cash prices
that may be about to top out as packer margins dwindle.         
       
    "It's been hard," said Rosenthal Collins broker James Burns
regarding Friday's conflicting market signals. "It feels like it
really comes down to what packer is just paying up for hogs like
crazy," he said.
    For almost three weeks established packing plants hiked hog
bids to maintain market share after four new plants came online
in recent months, said traders and analsyts. 
    They expect wholesale pork values to fluctuate over the next
couple of weeks as Pork Month in October winds down and
supermarkets consider advertising beef in November.          

 (Reporting by Theopolis Waters; Editing by Chizu Nomiyama)
  

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