Cattle futures rise on lower-than-expected placements - CME

US hog markets dip
calendar icon 20 November 2023
clock icon 2 minute read

Chicago Mercantile Exchange (CME) live cattle and feeder cattle futures ended higher on Friday as livestock traders adjusted positions in the markets, reported Reuters.

After the close of trading, the US Department of Agriculture (USDA) issued monthly data that showed producers placed 3.8% more cattle into feedlots in October than a year earlier, below analysts' expectations for a 4.9% increase.

Lower-than-expected placements may support futures prices next week, though money flows and positioning ahead of the US Thanksgiving holiday could overrule supply factors, analysts said.

Cattle weighing more than 700 pounds in feedlots signal the sector will be well supplied early next year, when the animals will become heavy enough to be slaughtered, said Altin Kalo, agricultural economist for Steiner Consulting. Supplies may not be as large heading into April, May and June, he said, signaling tightness for the sector.

"We have a total supply on feed that is a little bit front heavy," Kalo said.

The USDA said there were 11.9 million cattle on feed for the slaughter market on Nov. 1, up 1.7% from a year earlier. That was close to analysts' expectations for a 1.8% increase.

Cattle marketings in October were down 2.5% from a year ago, compared to analysts' estimates for a decline of 2.1%.

CME December live cattle futures closed 1 cent stronger at 175.750 cents per pound, before the US issued its monthly data. February 2024 live cattle futures advanced 1.475 cents to 176.800 cents per pound.

January 2024 feeder cattle futures rose 1 cent to 228.500 cents per pound.

Cash cattle prices traded around $178 per cwt in Texas, Kansas and Nebraska this week, down about $2 from last week, traders said.

In Brazil, JBS, the world's leading meatpacker, on Monday will reopen a large Brazilian beef unit,

In the pork market, CME December lean hog futures dipped 0.5 cent to end at 70.975 cents per pound.

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