Livestock Futures Strengthen Ahead of Memorial Day Weekend
May 25 2017 - 3:18PM
Dow Jones News
By Benjamin Parkin
CHICAGO--Livestock futures inched higher on Thursday, reversing
course after a mixed start to the trading session.
Cash prices for cattle so far this week are lower than previous
weeks, though they remain at a considerable premium to futures.
That's helping to anchor cattle futures and prevent them from
falling sharply as the market enters a seasonal slump.
"There's no doubt that the cash market is starting to come
down," said Don Roose, president of brokerage U.S. Commodities in
Des Moines, Iowa. "Going through June that's going to be the
pattern: The cash comes down more than the futures go up."
The U.S. Department of Agriculture reported live cattle sales
for Wednesday of $1.32 a pound on moderate demand in southern
states like Texas and Kansas, rising to $1.33 a pound in Colorado.
That demand helped to lift futures on Thursday, said Brian Hoops,
president of brokerage Midwest Market Solutions in Springfield,
Mo.
Live cattle futures for June delivery rose 1.5% to $1.23925 a
pound at the Chicago Mercantile Exchange on Thursday. Feeder cattle
futures for August delivery also rose.
Analysts said demand for beef appears weaker. Retailers' efforts
to secure supply of the meat ahead of Memorial Day weekend pushed
prices higher and encouraged packers to raise bids on the cash
market, analysts said, though they're now well stocked.
"Retailers have all the beef they need for the coming weekend,
and that the high retail price might discourage demand," said
Chicago-based forecaster the Hightower Report in a note to
clients.
Hog futures also reversed course, closing higher after sliding
at the opening. Cash hog prices and pork values, which were lower
on Wednesday, starting rising on Thursday morning, according to the
USDA.
CME June lean hog futures closed up 0.9% at 80.95 cents a pound.
That was a new high for the June contract, and the highest for a
front-month contract since July last year.
Write to Benjamin Parkin at benjamin.parkin@wsj.com
(END) Dow Jones Newswires
May 25, 2017 15:03 ET (19:03 GMT)
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