US feeder cattle market hits new highs - CME
Lean hog markets end higher
18 April 2023
2 minute read
By: Chicago Mercantile Exchange (CME) feeder cattle futures hit new all-time highs in the nearby contracts on Monday, as bidding wars continue to rally cash prices as more producers show interest in expanding their herds, Reuters reported, citing traders.
The rally helped give a boost to the pork market, where CME April lean hogs ended up 0.125 cent at 71.875 cents per pound, while most-active June lean hogs rose 1.3 cent at 88.175 cents per pound.
Tight US cattle supplies have been rallying cash prices for weeks, as some cattle producers are gambling on fat profits by putting more animals on pasture this spring, traders said.
As supplies are expected to decline further in the second half of the year, investors on Monday shrugged off a rally in corn futures to further push for new price peaks in the cattle market, said Dan Norcini, an independent livestock trader.
Most-active May feeder cattle hit a contract high of 210.85 cents per pound on the day, before settling up 2.85 cents at 210.75 cents per pound.
April feeder cattle also settled up 2.15 cents at 205.55 cents per pound - after touching a contract high of 205.90 cents per pound in mid-day trading.
That cash market rally is expected to continue, analysts said. Strong demand opened up the feeder cattle cash market on Monday in the Oklahoma City area, traders said, with prices rising particularly for heifer calves.
"To me, that's an indication that people are thinking they need to start rebuilding this herd, even though feed prices are high," Norcini said.
Beef production was 502.8 million pounds for the week ending April 15, down 5% from a year earlier, according to US Department of Agriculture estimates published on the agency’s website Friday.
April live cattle futures ended up 1 cent at 175.750 cents per pound, while June live cattle finished up 1.15 cents at 164.875 cents.
