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CME update: live cattle futures strengthen alongside beef demand

02 December 2020

US live cattle futures rose on 1 December, supported by strengthening US consumer demand and high wholesale beef prices.

Reuters reports that Chicago Mercantile Exchange February live cattle futures added 0.300 cent to 113.175 cents per pound.

CME cattle futures have been steady in recent weeks, recovering from a slump in late October as rising COVID-19 cases across rural America threatened packing plant closures similar to those seen in March.

But beef processing hasn't slowed this time around, according to government data.

 

"Even with these high COVID cases, we really haven’t seen major disruptions in packing plants," said Altin Kalo, economist at Steiner Consulting Group. "It seems like this market has found some support at these levels."

Wholesale beef prices remain elevated, with select cuts adding 65 cents to $233.08 per 100 lbs, while choice cuts trimmed 28 cents to $243.40.

CME January feeder cattle ended 0.600 cents higher at 141.650 cents per pound after notching 143.475 cents per pound, its highest since Aug. 21, benefiting from lower corn futures and tighter cattle supplies.

And as US cow-calf operators struggle with ever-tightening profit margins, those supplies could remain tight, traders said.

"The market is realising there’s not a lot of calves out there," said Kalo.

Read more about this story here.

Source: Reuters



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