Cattle futures rose the most in three weeks on speculation that U.S. animal supplies are shrinking as demand for beef climbs. Hog prices also increased.
Steers averaged $1.2722 a pound in the first three days of this week, up 2.1 percent from a week earlier, U.S. data show. Meatpackers are buying animals for the first full week of the new year for slaughter, supporting prices, Troy Vetterkind, the owner of Vetterkind Cattle Brokerage LLC in Chicago, said in a report.
“There’s still quite a bit of optimism in this cattle industry that our numbers are still tight, and our demand is going to increase for the next two or three weeks,” Lane Broadbent, a vice president at KIS Futures in Oklahoma City, said in a telephone interview.
Cattle futures for February delivery climbed 1.1 percent to settle at $1.3385 a pound at 1 p.m. on the Chicago Mercantile Exchange, marking the biggest gain for the most-active contract since Dec. 11.
Feeder-cattle futures for March settlement rose 0.6 percent to $1.549 a pound.
Hog futures for February settlement added 0.3 percent to close at 86.4 cents a pound in Chicago. In 2012, the price increased 1.7 percent, the fifth straight gain and the longest rally since at least 1987, according to exchange data compiled by Bloomberg. The commodity debuted on the CME in February 1966.