Chicago | Reuters — Chicago Mercantile Exchange live cattle futures ended lower on Wednesday after digesting this week’s prices for market-ready or cash cattle ahead of Thursday’s U.S. Thanksgiving holiday, traders said.
December closed 0.9 cent per pound lower at 169.25 cents, and February 1.35 cents lower at 169.675 cents (all figures US$).
On Wednesday, cash cattle in Kansas and Nebraska sold at $172 to $173 per hundredweight (cwt), mostly steady with the bulk of last week’s sales, feedlot sources said.
Packers spent enough on cattle for the first full week of production after Thanksgiving while being mindful of their poor margins.
Beef packer margins for Wednesday were a negative $100 per head, compared with a negative $109.65 on Tuesday and a negative $77.70 a week earlier, according to Colorado-based analytics firm HedgersEdge.com.
Processors have gradually raised the price of wholesale beef to offset high-priced cattle and shore up their slumping margins.
Wednesday morning’s choice wholesale beef price was up 59 cents/cwt from Tuesday to $257.46. Select gained 16 cents to $243.83, the U.S. Department of Agriculture said.
Thinly traded CME livestock futures could be in for a choppy session on Friday when markets will close an hour early on the final trading day for the month of November.
Technical-related selling, firm corn prices and lower live cattle futures pressured CME feeder cattle contracts.
January closed 0.875 cent/lb. lower at 230.5 cents, and March at 229.35 cents, down 0.575 cent.
Hogs end mixed
CME lean hogs settled mixed after a bumpy ride stirred by pre-holiday positioning, traders said.
December closed unchanged at 90.95 cents, February down 0.275 cent to 89.55 cents and April up 0.225 cent at 91.875 cents.
Lower cash hog and wholesale pork prices at times pressured CME hogs, but short-covering and speculative buying provided sporadic support.
The morning’s average hog price in the Iowa/Minnesota market was down $1.05/cwt from Tuesday in thin volume at $86.23, according to USDA.
Separate government data showed the morning’s wholesale pork price was down 52 cents/cwt from Tuesday to $91.66, led by the $5.75 drop in ham costs.
Some packers are already scheduling hogs for what is expected to be a big post-Thanksgiving weekend slaughter, while others are snug on inventories, a trader said.
Ham demand has subsided as retailers concentrate on featuring beef in December, he said.
— Theopolis Waters reports on livestock futures markets for Reuters from Chicago.