Chicago | Reuters — Chicago Mercantile Exchange live cattle futures continued to advance Friday, supported by increasing beef prices and expectations of continued meat demand going into the Labour Day weekend, traders said.
Beef prices usually rise heading into the September holiday, when consumers often barbecue either at home or with family and friends.
Beef slaughter rates continue to increase, as have cut-out prices: Prices for choice cuts of boxed beef jumped $3.09, to $214.04/cwt on Friday, while select cuts increased by $1.83, to $199.24/cwt, according to the U.S. Department of Agriculture (all figures US$).
But profit margins for beef processors eased on Friday, to $248.85 per head of cattle from $249.55 a day earlier, according to Denver-based livestock marketing advisory service HedgersEdge.com.
“There are a lot of indications that grilling is big right now with the weather being nice and people feeling sick of being stuck inside,” said Karl Setzer, commodity risk analyst for AgriVisor. “That is translating into meat demand.”
CME October live cattle rose 0.075 cent to settle at 110.225 cents/lb. September feeder cattle slipped 0.8 cent, to 146.575 cents/lb.
In the pork market, CME October lean hogs settled 0.675 cent higher at 53.025 cents/lb.
There also is a feeling among traders that the market has bottomed after recent volatility, particularly for the beef sector, said Don Roose, president of Iowa-based broker U.S. Commodities.
“The cash cattle trade was done for the week, and the sense is that cash prices will be up another $2 or $3 next week,” Roose added.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago.