Chicago | Reuters — U.S. live cattle futures on the Chicago Mercantile Exchange eased on Friday, as basis between cash cattle and futures narrowed, analysts said.
“We had some profit taking, because the cash market finally surged higher,” said Cassie Fish, analyst and author at the blog, The Beef.
Cash cattle traded as high as $124.50/cwt in parts of Nebraska, up from $118/cwt a week ago, according to the U.S. Department of Agriculture (all figures US$).
CME June live cattle settled 2.45 cents lower at 122.575 cents/lb., erasing much of the week’s gains to end just 0.025 cents above the previous week.
Live cattle remain supported by strong gains in boxed beef as the country heads into the spring and summer, when beef consumption traditionally increases.
Choice cuts of boxed beef gained $1.67, to $272.17/cwt, climbing $22.20 since April 1. Select cuts gained 24 cents, to $264.07/cwt, according t USDA.
“I wouldn’t be trumpeting that the cattle market topped just yet,” Fish said.
Feeder cattle also eased, as May futures lost 1.975 cents, to 149.625 cents/lb. For the week, CME’s most-active feeder cattle contract added 0.4 cents.
Meanwhile, CME lean hog futures continued higher on tight supply and strong domestic consumer demand.
CME June lean hogs added 0.25 cents, to 108.95 cents/lb., after reaching a high of 109.55. Nearly all contract months found new life-of-contract highs. For the week, the most-active hog contract gained 7.175 cents, adding seven per cent from the previous week, for a fifth consecutive week of gains.
The CME’s lean hog index, a two-day weighted average of cash prices, climbed to $100.94/cwt, its highest since Oct. 17, 2014.
For the week, pork production hit 2.28 million head, down 5.2 per cent from the week prior and 2.2 per cent less than the same week a year ago.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.