Cattle Futures Resume Losing Streak, Supplies Weigh on Prices
December 13 2017 - 4:16PM
Dow Jones News
By Benjamin Parkin
Cattle futures fell, giving back early gains as growing supplies
weighed down prices.
Market observers said more cattle on feed are reaching slaughter
size, meaning a larger supply of fattened animals ready for
processing into beef. That is allowing meatpackers to lower bids
and push cash prices lower for physical cattle.
Cash prices this week were due to fall, analysts said. Packers
bought one lot of 75 cattle from Kansas for $116 per 100 pounds at
the online Fed Cattle Exchange auction on Wednesday morning, at
which a little over 700 head were listed. Elsewhere, packers were
mostly bidding $114 on a live basis. Last week, live prices
averaged $117.50 and dressed averaged $187.
December-dated live cattle futures fell 0.4% to $1.1565 a pound
at the Chicago Mercantile Exchange on Wednesday, after opening
higher. Prices rose on Tuesday for the first time after eight
consecutive sessions lower.
Demand for beef ahead of the holidays wasn't keeping pace with
growing supplies of beef, analysts said. Wholesale beef prices fell
$1.05 to $203.01 per 100 pounds as of midday Wednesday, extending
losses from a day earlier.
"After eight consecutive days of losses the cattle futures
market finally came up for air," said Troy Vetterkind, owner of
Vetterkind Cattle Brokerage, in a note. "It was probably nothing
more than a 'dead cat' bounce but much needed nonetheless... A
sustainable rally will be tough to hold until we get past the first
of the year."
Hog futures rose, despite pressure on both cash and meat prices.
CME December lean hog contracts gained 0.3% to 63.95 cents a
pound.
Wholesale pork prices tumbled almost $5 per 100 pounds as of
midday, led by a sharp drop in pork belly prices. Bellies, used to
make bacon, fell $16.34 to $107.24.
Low belly stocks helped push prices to records earlier this
year. But stocks have regrown because of higher slaughter numbers,
forcing belly prices lower.
Write to Benjamin Parkin at benjamin.parkin@wsj.com
(END) Dow Jones Newswires
December 13, 2017 16:01 ET (21:01 GMT)
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