July 12, 2011

US live cattle futures increase

Monday's (Jul 11) rally in US hogs futures caused live cattle futures to increase also as traders mull over cues of pork demand from China against broad-based apprehension over the euro zone.

Live cattle for August finished essentially flat at US$1.147 a pound while October gained 0.45 cent to US$1.207. Meanwhile, August feeder cattle fell 0.25 cent to US$1.434 a pound.

Higher pork buying by China could lead to tighter supply of meat and protein generally, analysts said, while further boosting US meat exports, which are more lucrative for meat packers than domestic sales.

Initial asking prices for cattle in the Texas Panhandle and Kansas were reported at mostly US$1.17 a pound on a live basis. No bids have been established yet and may not be available until Tuesday (Jul 12) afternoon or Wednesday (Jul 13).

Sales last week in Texas/western Oklahoma were US$1.1450 to mostly US$1.15 a pound and in Kansas mostly US$1.14-1.15 a pound.

USDA's midday beef price quote for choice grade carcasses was off 29 cents to US$178.90 a hundred pounds, and select fell six cents to US$174.00 a hundred pounds on 140 total loads.

The latest HedgersEdge packer margin index was plus US$29.90 a head, compared with US$31.75 the previous day. This is an estimate of packer returns on cattle slaughtered and processed expressed in the form of an index.