September 29, 2017 / 8:25 PM / a year ago

LIVESTOCK-CME hogs end quarter mostly higher on short-covering

    * Live cattle closes firmer
    * Feeder cattle ends weaker

    By Theopolis Waters
    CHICAGO, Sept 29 (Reuters) - The bulk of Chicago Mercantile
Exchange lean hog contracts on Friday finished higher in the
final trading session for the quarter, ignited by fund buying
and short-covering, said traders.
    They said futures rallied from earlier losses on Friday and
prior to late Thursday's U.S. Department of Agriculture
quarterly hog report.             
    The report was mildly supportive for futures because most
results were close to forecasts, but the data also confirmed
continued herd growth, a bearish market factor, said analysts.
    Investors will monitor slaughter-ready, or cash, hog prices
that have declined for two month due to record-high hog
    "There is nothing in Thursday's report that says that the
cash market is going to do a 180 and turn up," said U.S.
Commodities analyst Don Roose.
    In the midst of growing supplies, pork demand will draw
interest as retailers prepare to feature product for National
Pork Month in October.         
    Deferred hog futures received added support from fund buying
after those contracts surpassed technical resistance levels.
    Investors purchased back month hog futures and
simultaneously sold the October contract ahead of its expiration
on Oct. 13.
    October         hogs ended down 0.150 cent per pound to
55.400 cents. 
    Most actively traded December         finished 1.675 cents
higher at 59.950 cents, and February         closed 1.700 cents
higher at 65.050 cents. Both contracts settled above their
respective 40-day moving average of 59.595 and 64.356 cents.
    CME live cattle        gained for a third straight session,
helped by end-of-quarter positioning as traders waited for
remaining cash cattle to change hands.
    October         live cattle finished up 0.125 cent per pound
to 109.100 cents, and December         closed up 0.200 cent to
115.250 cents.
    So far this week, a small number of cattle in Texas and
Kansas brought $108 per cwt, steady with a week ago. Other
sellers in the U.S. Plains are holding out for at least $110.
    "Packers are making good money and can afford to pay no
worse than last week for supplies," a trader said.
    However, cattle numbers are plentiful and packers can soon
draw from animals contracted against the futures market, said
traders and analysts.           
    They also pointed out that beef demand might suffer during
Pork Month, and grocers will soon consider promoting ham and
turkey for the Thanksgiving, Christmas and New Year's holidays.
    Profit-taking and technical selling undercut CME feeder
cattle contracts.
   October         ended 0.725 cent per pound lower at 152.225

 (Reporting by Theopolis Waters; Editing by Lisa Shumaker)
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