Chicago | Reuters – Chicago Mercantile Exchange live cattle futures closed higher on Monday after news that New World screwworm, a flesh-eating parasite, was detected 70 miles from the U.S.-Mexico border, analysts said.
Analysts believed the news would mean the U.S.-Mexico border will be closed to feeder cattle imports for the foreseeable future.
“It’s bullish because the border is going to stay closed,” Dan Basse, president of AgResource, said.
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The border has been closed to feeder imports for months to prevent the spread of screwworm and has further constricted an already tight cattle supply.
CME December live cattle LCZ25 ended up 4.5 cents at 240.225 cents. October feeder cattle FCV25 rose 7.25 cents to end at 361.35 cents per pound.
The U.S. Department of Agriculture on Monday also hinted at plans to stimulate the rebuilding of the herd. Analysts also interpreted the announcement as bullish, as increased heifer retention would temporarily reduce the cattle supply.
Monthly feedlot data from the U.S. Department of Agriculture, released on Friday, came in close to trade expectations.
The USDA reported the number of cattle in U.S. feedlots as of September 1 at 11.1 million head, down 1.05 per cent from a year earlier, while analysts surveyed by Reuters ahead of the report on average had expected a slightly smaller drop of 0.9 per cent.
Wholesale beef prices continued to retreat from near-record highs set in early September as the summer grilling season wound down. The USDA priced choice cuts of beef at $381.39 per hundredweight (cwt) on Friday afternoon, down 66 cents from Thursday.
CME lean October hogs LHV25 settled up 0.825 cent at 98.80 cents per pound.
The USDA priced the hog carcass cutout at $112.05 per cwt on Friday afternoon, up 10 cents from Thursday.
