CME: Live, Feeder Futures Closed Higher19 July 2013
US - Live and feeder futures closed significantly higher, supported by aggressive short covering and technical buying. On the other hand, the lean hog pit settled on a mixed basis with 2013 contracts outperforming 2014 deferreds.
The cattle market traded steady to slightly higher going into the pit opening and then futures climbed sharply higher after a lower grain opening and a surge in feeder cattle prices and were able to finish Thursday's trading session with sizable gains.
One of the heaviest rains in years for Texas during the past week, combined with cheaper feedgrain prices have many traders believing that non-feedlot cattle slaughter will drop off dramatically during the last four months of this year. In addition, some traders see a break in the heat over the Midwest for the weekend and next week as a factor which could help beef prices find a near-term low.
December cattle managed to drive up to the highest level since April 4th. Many in the market saw the weekly export sales data as somewhat positive given the recent surge higher in the US Dollar.
Weekly U.S. beef export sales for the week ending July 11th came in at 15,200 metric tonnes, compared with the prior 4-week average of 14,000 metric tonnes. Cumulative sales for 2013 have reached 455,300 metric tonnes, which is down 16.7% from last year's pace.
Other traders appeared to be less concerned with furloughed meat inspectors for later this year than was the case yesterday, which added to the positive tone of the market.
TheCattleSite News Desk