* USDA biannual cattle data due at 2 p.m. CST (2000 GMT
* Futures' premium to cash, fallen beef prices weigh
* Feeders weaken by live cattle, pre-report caution
* Feb hogs gain on discount to cash, others lower
* Russia meat ban hangs over livestock markets
By Theopolis Waters
CHICAGO, Feb 1 Chicago Mercantile Exchange live
cattle futures closed lower on Friday amid caution before the
government's biannual cattle inventory report at 2 p.m. CST
(2000 GMT), analysts and traders said.
Analysts expect the report to show the U.S. cattle herd
declined for a sixth straight year as drought drove up feed
Also, futures' premium to cash cattle prices and pushback by
grocers and other buyers against beef at higher prices prompted
And traders cited market uncertainty as Russia announced
plans to ban imports of U.S. beef and pork, effective Feb. 11.
CME spot February live cattle closed at 127.100 cents
per lb, 0.525 cents lower. April ended down 0.625 cent
at 132.175 cents.
Live cattle futures finished up 0.67 percent for the
Cash-basis cattle in the U.S. Plains traded at $125 per cwt,
compared with $122 to $125 last week, feedlot sources said.
Packers raised bids for cattle due to fewer animals
available than a week ago and tighter supplies ahead. But
elusive margins and slumping wholesale beef prices limited how
much processors were willing to spend for supplies.
Tyson Foods executives could not confirm talk in the
CME live cattle market that the potential shortage of cattle
would prompt the company to scale back slaughter operations at
all of its beef plants.
The price for wholesale choice beef Friday morning was
$183.99 per cwt, down $1.33 from Thursday, and select cuts
dropped 69 cents to $179.56, according to the USDA.
HedgersEdge.com put the average beef packer margin for
Friday at a negative $48.10 per head, compared with a negative
$26.25 on Thursday and a negative $45.45 on Jan. 25.
CME feeder cattle closed lower, weakened by live cattle
losses and pre-report caution.
Futures closed 3.1 percent higher for the week.
March finished down 0.350 cent per lb at 149.200
cents and April closed 0.450 cent lower at 152.125
MOST HOGS SLIDE
Spot February hog futures drew support from its discount to
CME's lean hog index at 88.25 cents, while other months wilted
CME hogs closed up 0.89 percent for the week.
Spot February hogs settled up 0.050 cents per lb to
87.650 cents. Most-active April ended at 88.750 cents,
0.750 cents lower, and June closed 0.600 cent lower at
"People couldn't get a firm handle on cash prices, and
packers' margins are getting away from them. Also, folks are
starting to get a little antsy about that Russian meat import
issue," a trader said.
The average hog price in the most-watched Iowa/Minnesota
market Friday morning was $3.04 per cwt lower at $86.49 per cwt
in extremely light volume after being up $2.05 on Thursday, USDA
The average pork packer margin for Friday was a negative
$10.15 per head, compared with a negative $5.20 on Thursday and
a negative $8.65 on Jan. 25, according to HedgersEdge.com.