Cattle futures advanced for a fourth straight session on signs that U.S. feedlots may have fewer animals available for beef processors. Hogs were unchanged.
Feedlots bought 2.252 million head of cattle in August, down 0.8 percent from a year earlier, the U.S. Department of Agriculture said Sept. 23. Analysts were expecting a 7.8 percent increase, a Bloomberg survey showed. The most expensive drought in Texas history has parched pastures and forced ranchers to shrink livestock herds.
“That report, for most, was a game changer,” Lane Broadbent, a vice president of KIS Futures Inc. in Oklahoma City, said in a telephone interview. “There have been lower placements and a lot of concern the last two to three days of where our supply of beef is going to come from.”
Cattle futures for December delivery climbed 0.2 cent, or 0.2 percent, to settle at $1.2085 a pound at 1:15 p.m. on the Chicago Mercantile Exchange. The price gained 22 percent in the past year.
The number of cattle available to sell to packers was also smaller this week, signaling tighter supply, Broadbent said.
Exporters shipped 1.6 billion pounds (729,000 metric tons) of beef in the seven months ended July 31, up 27 percent from a year earlier, U.S. Department of Agriculture data show. Wholesale-beef prices gained 16 percent in the past year, according to the USDA.
Feeder-cattle futures for November settlement gained 0.075 cent to close at $1.41925 a pound in Chicago.
Hog futures for December settlement closed unchanged at 83.475 cents a pound on the CME.
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