CME: Snow Storms Lift Futures, Wednesday28 February 2013
US - Live cattle futures were supported throughout Wednesday by evidence the boxed beef market has posted a near-term low, giving traders more confidence to reestablish long positions, write analysts at ProFarmer.
February cattle closed $1.27 1/2 higher, with the rest of the market steady to 57 1/2 cents higher.
April cattle saw choppy to higher trade on Wednesday and managed to close moderately higher on the day with news stories of tremendous weight loss from cattle in feedlots from Texas to Kansas helping to support the market.
The market experienced solid gains on the day into the pit opening and made several rallies over 130.00 on the day as traders see better cash cattle trade ahead, write experts at the Chicago Mercantile Exchange.
Boxed beef cutout values at mid-session came in at $185.33, up 82 cents from yesterday and up from $182.31 last week at this time. Select beef was up $2.03 to $184.60.
The rally pushed the market up to the highest level since February 19th and spot February futures surge higher to the highest level since January 31st. Ideas that the market will receive reduced tonnage in the short-run due to the winter storms of the past week has helped to support solid gains.
In addition, beef prices saw solid gains on Tuesday and pushed up to the highest level since January 31st and this gives trader hope than cash cattle can work higher in the weeks just ahead.
Talk of concerns for any disruptions to the packing industry due to government spending cuts added to the positive tone.
There were no new deliveries against the February contract.
Cattle slaughter came in well above expectations at 121,000 head.
TheCattleSite News Desk