Cattle Futures: Cattle Complex Higher On Lower Corn
US - Chicago Mercantile Exchange live cattle futures Monday closed very near the 2 1/2-week highs of the day, supported by lower Chicago Board of Trade corn futures, traders said."The only factor we are looking at is corn," said one veteran trader, referring to the action in live cattle. "Keep it simple."
CBOT corn spent most of the morning locked down its 20-cent limit and only came off that limit late in the session. Corn still was under pressure from a bearishly construed U.S. Department of Agriculture prospective plantings report Friday morning. It was the second straight day of limit moves, and many traders believe a limit move begets more trading beyond the limit within a few days.
Live cattle futures also received support from ideas beef markets were set to bounce seasonally, traders said. The USDA reported midday boxed beef prices higher than on Friday, indicating that anecdotal accounts of market firmness may be correct, they said.
Further gains in beef prices are expected in coming days as retail and restaurant buyers pick up the pace of booking product for late April-early May needs, traders said.
Deferred cattle contracts were not as strong as the nearbys because the lower corn prices could encourage some cattle feeders to keep their cattle on feed a little longer for a little extra weight gains during the summer, one broker said.
Source: FX STREET