LIVESTOCK-CME live cattle rises to three-week peak on tightening US supply


By Tom Polansek

CHICAGO, March 29 (Reuters) - Chicago Mercantile Exchange live cattle futures marched to a three-week high on Wednesday on expectations for tighter U.S. supplies, analysts said.

Feeder cattle futures also advanced, while lean hogs softened.

Technical buying helped support live cattle, analysts said, after a drop near eight-week lows last week was seen as overdone.

The United States will not be wallowing in heavy cattle supplies as usual this summer, after producers have reduced herds due to drought and high feed costs, said Rich Nelson, chief strategist at brokerage Allendale.

"We are questioning what the supply will look like these next few months," Nelson said. "It'll be around July that supplies change earlier than normal."

In the hog market, front-month April futures LHJ3 ended 0.975 cent lower at 76.775 cents per pound. June hogs LHM3 fell 1.900 cents to 90.825 cents per pound as weak cash prices weighed on futures, analysts said.

Hog traders on Thursday will review quarterly USDA data that analysts expect will show the nation's herd on March 1 was 0.2% bigger than a year earlier. Larger-than-expected hog slaughtering indicate the government has previously underreported the herd's size, analysts said.

"We're basically seeing clear evidence that the December report undercounted numbers for the springtime and also likely summer," Nelson said.

Meatpackers slaughtered an estimated 477,000 hogs on Wednesday, compared with 478,000 hogs a week ago and 479,000 hogs a year earlier, the USDA said.

Separately, the USDA priced the pork carcass cutout at $80.26 per hundredweight (cwt), up 26 cents. Belly values climbed by $7.85 to $91.49 per cwt.

(Reporting by Tom Polansek; Editing by Shilpi Majumdar)


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.