Lean hogs bounce back after Tuesday's decline - CME
Cattle futures climb to life of contract highs
23 January 2025
2 minute read
By: Chicago Mercantile Exchange (CME) live and feeder cattle futures climbed to life of contract highs on Wednesday, as funds took a massive net long position, Reuters reported, citing analysts.
CME February live cattle futures settled up 3 cents at 200.05 cents per pound, while the April contract, which is now the most actively traded, ended up 2.450 cents at 199.775 cents per pound. All contracts reached lifetime highs.
Meanwhile, CME March feeder cattle settled up 5.825 cents at 273.075 cents per pound, with January and March both reaching life of contract highs.
Fund buying was largely responsible for the rallies, said Cassie Fish, analyst and author of The Beef newsletter.
"I don't think I've ever seen the managed fund buying in cattle futures - feeder and live cattle futures, as aggressive as it is currently in my career," she said.
Prices for wholesale beef weakened with a seasonal decline expected in the coming months, according to analysts.
The US Department of Agriculture's boxed-beef index for choice cuts fell $0.03 on Wednesday afternoon to $332.02 per hundredweight (cwt). Select cuts dipped $1.56 to $317.99.
Packers were working to keep their margins from dipping further into the red, said Fish, trying to produce just enough meat to fill orders.
Beef packer margins fell $57.15 per head on Wednesday, compared with losses of $46.75 per head on Tuesday and losses of $21.25 per head last week, according to livestock marketing advisory service HedgersEdge.com.
Meanwhile, traders continued to wait for the USDA to resume cattle imports from Mexico, after the US blocked shipments in November over the discovery of the New World screwworm pest in Mexico.
In lean hogs, futures bounced back after declining on Tuesday.
CME April hogs settled up 0.575 cent at 87.275 cents per pound and front-month February hogs rose 0.275 cent to end at 81.475 cents per pound.
