Cattle futures rose to the highest in almost three weeks on signs that fewer animals are available for U.S. slaughterhouses amid robust demand for beef. Hogs also gained, and feeder cattle climbed to a record.
An estimated 3.6 million cattle have been processed this year through Feb. 11, down 5.4 percent from 2011, government data show. The number of animals being offered for sale by feedlots to meatpackers is “surprisingly low,” said Lane Broadbent at KIS Futures Inc. Wholesale-beef prices are up 3.4 percent since touching a four-month low on Jan. 19.
“Packers are having to buy cattle on the sellers’ terms,” Broadbent, a vice president, said in a telephone interview from Oklahoma City. “Demand is still very good overseas and very solid domestically. You get increasing demand and tighter supplies, and that will mean higher-priced cattle.”
Cattle futures for April delivery advanced 0.9 percent to close at $1.2925 a pound at 1 p.m. on the Chicago Mercantile Exchange, after reaching $1.2945, the highest for a most-active contract since Jan. 25, when the commodity jumped to a record $1.29675. Prices have gained 6.4 percent this year and almost 14 percent from a year ago.
Feeder-cattle futures for March settlement increased 1 percent to $1.5625 a pound in Chicago, after reaching a record $1.568.
Wholesale beef rose to $1.8769 at midday today, the highest since Jan. 11, U.S. Department of Agriculture data show. Exports of the meat totaled 2.8 billion pounds (1.3 million metric tons) last year, up 21 percent from a year earlier, according to the USDA. Canada, Mexico and Japan were the biggest buyers.
Hog futures for April settlement gained 1.9 percent to settle at 89.625 cents a pound in Chicago. Prices are up 6.3 percent this year.