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CME: Futures Close Steady Thursday

11 January 2013

US - Live cattle futures ended steady to 27 1/2 cents lower through the October contract. Far deferred futures closed steady to 7 1/2 cents higher.

Nearby futures softened into the close on news of additional cash cattle sales in Kansas at slightly lower prices compared to last week. But so far, cash cattle trade has been light and mostly in line with last week's $128 cash trade.

February cattle closed 40 higher on the session unchanged on the session but well off of the highs and April cattle closed moderately lower on the day and pushed to the lowest level since December 11th closing lower for the fifth session in a row.

The market saw a bounce early in the day to see a moderate gain into the pit opening but gave back all of the gains into the mid-session to trade just slightly higher on the day. A much more positive tilt to outside markets including a weaker US dollar, strong trade data from China and strength in other commodity markets helped to support.

The feedlot regions in Texas and Oklahoma saw more rain than expected and mud may slow feedlot performance which helped to support the market early. However, a higher than expected showlist, sluggish beef prices and poor packer margins have left traders expecting cash to trade steady at best this week. This has discouraged new buyers due to the premium of futures to the cash market.

Talk that the break yesterday was overdone and a general sense that the market will be faced with declining supply ahead has helped to provide some underlying support.

Weekly U.S. beef export sales for the week ending January 3rd came in at 7,300 metric tonnes as compared with 8,600 tonnes last week at this time. Average dressed steer weights for the week ending December 29th came in at 873 pounds, unchanged from the previous week and up from 849 pounds last year and 846.6 pounds as the 5-year average. While slaughter for that same week was down 20.2 per cent from last year, the higher weights left beef production down 17.3% from last year.

Choice boxed-beef cut-out values were up $0.15 at mid-day to $193.70 as compared with $194.91 last week at this time. Select boxed-beef cut-out values at mid-session were up $0.61 to $184.14 as compared with $183.28 last week at this time. Slaughter came in well under trade expectations at 124,000 head.

Daily Livestock Report - Copyright © 2008 CME. All rights reserved.

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