LIVESTOCK-US live cattle rise on report, winter storm

Mon Feb 25, 2013 4:43pm EST

Related Topics

* Blizzard conditions curb beef production at some plants
    * Firmer wholesale beef prices lend futures support
    * Feeders sag with deferred live cattle contracts
    * Hog futures gain as wintry weather lifts cash prices

    By Theopolis Waters
    CHICAGO, Feb 25 (Reuters) - Chicago Mercantile Exchange live
cattle futures rose for a third straight day on Monday following
the U.S. Department of Agriculture's monthly cattle-on-feed
report last Friday, traders and analysts said.
    The data showed higher-than-expected marketings in January
against the first increase in the number of cattle placed on
feedlots in eight months that stirred bullish spreads.
 
    Blizzard conditions in parts of the U.S. Plains are making
it difficult to transport livestock to packing plants and move
fresh product to customers.
    Cargill Inc's Friona, Texas, beef processing plant
was not operating on Monday because road conditions made it
impossible for trucks to move cattle and beef to and from the
facility, company spokesman Michael Martin said.
    "Our Dodge City, Kansas, beef plant is operating only one
shift today, with both shifts scheduled for tomorrow," he said.
    The Tyson Foods Inc beef complex in Amarillo, Texas,
was also idled by Monday's storm, said company spokesman Gary
Mickelson.
    Packers on Monday processed 87,000 head of cattle, down
22,000 from a week earlier and 33,000 less than a year ago
during the same period, based on USDA data. 
    "As a result of the storms last week and today's storm,
feedlot conditions have deteriorated significantly ... and
cattle weights are likely to fall sharply," Hales Trading Co
president David Hales said.
    Reduced slaughters since late last week slowed the movement
of fresh beef to grocers and other buyers while lifting
wholesale beef prices and improving packer margins. 
    The wholesale price for choice beef on Monday was $183.09
per cwt, up 20 cents from Friday; select cuts slipped 5 cents to
$180.14, according to the USDA.
    HedgersEdge.com put the average beef packer margin for
Monday at a negative $42.25 per head, compared with a negative
$50 on Friday.
    Investors were waiting for feedlots to count the number of
cattle available for sale.
    Cash-basis cattle last week fetched $123 to $125 per cwt,
which was steady to $2 higher than the previous week, feedlot
sources said.
    Spot February live cattle closed at 126.950 cents
per lb, 0.600 cent higher. Most-actively traded April 
ended up 0.200 cent to 128.425 cents.
    CME feeder cattle were weakened by deferred live cattle
contracts and firm corn prices.
    March feeders settled 0.450 cent per lb lower at
140.800 cents. April ended at 143.700 cents, down 0.075
cent.

    HOGS REBOUND ON WEATHER             
    Hog futures posted modest gains in anticipation that cash
hog prices would trend higher in the near term, which spawned
short-covering, analysts and traders said.
    "Packer margins have improved significantly after they
lowered cash hog bids for almost a week. Weather is supposed to
get worse before it gets better, so packers are going to be
hurting for supplies," a trader said.
    USDA data showed the average price for hogs in the
most-watched Iowa/Minnesota market on Monday at $76.26 per cwt,
83 cents higher than Friday.
    The average pork packer margin for Friday was at a positive
$5.45 per head, compared with a positive $2.95 on Friday,
according to HedgersEdge.com.
    April hogs ended at 81.900 cents per lb, 0.250 cent
higher. June closed up 0.100 cent to 91.050 cents.
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