Nov. 18 (Bloomberg) -- Cattle futures jumped to a 26-month high on signs that overseas demand for U.S. beef is climbing. Hogs gained the most in a week.
U.S. exporters sold 19,344 metric tons of beef in the week ended Nov. 11, up 49 percent from a week earlier, Department of Agriculture data show. In the nine months ended Sept. 30, U.S. beef and veal exports rose 17 percent to 1.654 billion pounds (750 million kilograms) from a year earlier, the latest government statistics show.
“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.”
Cattle futures for February delivery gained 1.9 cents, or 1.9 percent, to settle at $1.045 a pound at 1 p.m. on the Chicago Mercantile Exchange. Earlier, the price reached $1.0485, the highest since Sept. 17, 2008. The commodity has climbed 21 percent this year.
Wholesale choice beef at midday was little changed at $1.5918 a pound after climbing yesterday to $1.5929, the highest since Nov. 3.
The Thomson Reuters/Jefferies CRB Index of 19 raw materials had the biggest gain in almost six weeks with only natural gas posting a decline. The dollar declined against a basket of major currencies, boosting prospects for U.S. meat exports.
Cattle prices are reacting to “a commodity-driven rally,” Broadbent said.
Meatpackers processed 524,000 cattle in the first four days of this week, up 6.7 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 1.3 cents, or 1.1 percent, to $1.1605 a pound.
Hog futures for February settlement climbed 1.65 cents, or 2.2 percent, to 75.8 cents a pound, the biggest gain for a most-active contract since Nov. 10. The price has advanced 16 percent this year.
Retail and export demand for pork boosted futures, 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,” he said.
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