CME: Nearby Futures Close Higher, Tuesday07 August 2013
US - Live cattle futures softened into the close, but nearbys still ended 12 1/2 to 37 1/2 cents higher, as August cattle stepped up to $120.92, say ProFarmer markets experts.
Deferred futures ended mixed. Price action in cattle futures was lackluster, as traders continue to weigh tightening supplies against disappointing demand. While early support came on hopes the boxed beef market is working on a near-term low, beef prices were mixed this morning on light movement, write ProFarmer analysts.
October cattle closed just slightly higher on the day and the market has been unable to hold on to the early gains for the third day in a row, write analyst from CME.
The market experienced choppy to mostly higher trade so far today and is trading 40 higher on the day into the mid-session.
Traders continue to expect a tightening supply of cattle but short-term supply seems to be higher than expected as weights are near record high for this time of the year and feedlots placed heavier-weight feeders in May and June and these cattle are helping to keep the short-term, market-ready supply ample.
There were 50 deliveries posted overnight which was not a surprise given the premium structure of futures.
However, big deliveries in cattle can sometimes indicate that producers are having trouble moving cattle to slaughter plants and is seen as a bearish force. Traders are looking for steady to higher trade in the cash market this week but the showlist is a bit higher than last week and beef prices are about steady on the week.
Boxed-beef cut-out at mid-session, was down 20 cents to $186.26 from $186.78 last week at this time.
Slaughter came in near trade expectations at 124,000 head.
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