Live cattle futures on the Chicago Mercantile Exchange (CME) rose on Monday, buoyed by a boost in wholesale cutout values and signs of sustained consumer demand, according to market analysts.
In contrast, lean hog futures eased following a price increase on Friday, as traders took profits, analysts noted.
Cash cattle market prices were expected to remain relatively stable, as packers continued to actively seek supplies, according to industry experts.
The rise in boxed beef prices was attributed to last-minute buying by retailers, restaurant suppliers, and other end-users, said Cassie Fish, analyst and author of The Beef Blog. Retailers and suppliers were eager to stock up ahead of the holiday season, driving demand for beef cuts.
Fish also indicated that the slaughter pace would slow as the Christmas and New Year holidays approach, when meat packers typically reduce operations for plant maintenance, resulting in tighter supplies.
Wholesale beef cutouts also gained strength, with this week likely being the last opportunity for retailers to secure ribs in time for New Year’s Eve celebrations. According to the U.S. Department of Agriculture (USDA), Choice boxed beef increased by $2.10 to $314.14 per hundredweight, while Select boxed beef rose $2.61 to $279.34 per hundredweight.
Packers’ losses were trimmed to an estimated $43.90 per head on Monday, compared with $97.45 per head on Friday and $50.20 per head the previous week, according to HedgersEdge, a marketing advisory service.
On the CME, February live cattle futures (LCG25) settled 0.850 cents higher at 187.025 cents per pound, while January feeder cattle futures (FCF25) edged down 0.025 cents, closing at 255.800 cents per pound.
Meanwhile, CME lean hog futures ended lower, with February contracts (LHG25) falling 0.825 cents to close at 86.500 cents per pound. The CME lean hog index price stood at $83.73 for the two days ending Dec. 5, slightly down from $83.93 for the previous two days.
The USDA also reported that the pork carcass cutout rose by $2.47 to $93.63 per hundredweight on Monday afternoon.
Related topic:
How To Trade Live Cattle Futures?
