Cattle futures climbed to a 26-month high in Chicago on signs that rising demand is exceeding supply. Hogs also gained.
U.S. exporters sold 19,344 metric tons of beef in the week ended Nov. 11, up 49 percent from a week earlier, government data show. Through September, U.S. beef and veal exports reached 1.654 billion pounds (750 million kilograms), up 17 percent from a year ago, the most-recent USDA data show. Wholesale-choice beef yesterday rose to the highest level in two weeks.
“The demand has been good domestically, and our export demand has been very good,” said Lane Broadbent, a vice president of KIS Futures Inc. in Oklahoma City. “Demand is outstripping supply here.”
Cattle futures for February delivery gained 1.35 cents, or 1.3 percent, to $1.0395 a pound at 10:50 a.m. on the Chicago Mercantile Exchange. Earlier, the price reached $1.0485, the highest since Sept. 17, 2008. Before today, the commodity rose 19 percent this year.
Yesterday, wholesale choice beef prices advanced 0.7 percent to $1.5929 a pound, the highest level since Nov. 3.
The Thomson Reuters/Jefferies CRB Index of 19 commodities added as much as 2 percent today. The dollar declined against a basket of major currencies. A slumping greenback enhances the investment appeal of some raw materials and increases demand for U.S. meat exports.
Cattle prices are reacting to “a commodity-driven rally,” Broadbent said.
This week, meatpackers processed 393,000 cattle through yesterday, up 5.6 percent from the same time last year, USDA data show.
“You can see how these packers are still wanting to kill as many cattle as possible, because they’re making money,” Broadbent said.
Feeder-cattle futures for January settlement rose 0.875 cent, or 0.8 percent, to $1.15625 a pound.
Hog futures for February settlement rose 0.5 cent, or 0.7 percent, to 74.65 cents a pound on the CME. Before today, the price jumped 13 percent this year.
“Retail and export demand” for pork is boosting futures prices, said David Kruse, the president of CommStock Investments Inc. in Royal, Iowa. “There’s hardly a commodity of any kind that’s really priced as competitively as pork.”
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org.