CME: Nearby Contracts Command Stronger Prices, Friday15 April 2013
US - Live cattle futures favored the upside most of Friday, but this gave way to some late profit-taking in far-deferred contracts.
Thus, nearby contracts posted slight gains and deferred contracts slight losses for the day. Feeder cattle future ended 80 cents to $1.30 lower for the day and sharply lower for the week. Live cattle posted moderate losses for the week, write market experts at ProFarmer.
Nearby contracts benefited from optimism beef demand will soon improve, as grocers featured premium beef cuts in weekly ads. But a forecast for chilly, wet weather next week tempers such expectations.
June cattle closed 10 higher on the session after choppy and two-sided trade but the market still lost 75 points for the week, say analysts at CME.
The market inched higher in quiet trade on Friday morning. Ideas that the market is oversold, the stiff discount of futures to the cash market, news that steer weights dropped 7 pounds in one week for the week ending March 30th to 851 pounds and ideas that weights will drop further due to poor weather in the plains were all factors which may have helped support.
While beef prices were down Thursday, traders see the highest volume since March 28th as a potential positive as beef movement is increasing on the break. A lack of deliveries so far against the April contract added to the positive tone.
Packer margins are weak and there is a threat of cutting back on kills but slaughter in the past few sessions has come in at an active level.
Boxed-beef cut-out values at mid-session were down 28 cents to $189.87 as compared with $191.32 last week at this time.
Slaughter came near expectations today at 112,000.
TheCattleSite News Desk