March 1 (Bloomberg) -- Cattle futures climbed to a three-week high on signs of increasing demand for U.S. beef and the outlook for tighter supplies. Hogs also rose.
Meatpackers processed 534,000 head of cattle this week, down 2.6 percent from a week earlier, U.S. Department of Agriculture data show. Steers averaged $1.2784 a pound in the first three days of this week, up 4.1 percent from $1.2276 a week earlier, according to the agency.
“The combination of the cash market and the lower slaughter, that’s really the driving force” behind today’s rally, Christian Mayer, a market adviser at Northstar Commodity Investments Co. in Minneapolis, said in a telephone interview.
Cattle futures for April delivery rose 0.1 percent to settle at $1.2995 a pound at 1 p.m. on the Chicago Mercantile Exchange. Earlier, the price reached $1.30725, the highest for a most-active contract since Feb. 8. This week, the commodity gained 1.3 percent, the most since mid-December.
This week, wholesale beef climbed 2.5 percent to $1.8749 a pound as of midday, heading for the biggest gain since mid-October, USDA data show.
Feeder-cattle futures for May settlement fell 0.4 percent to $1.474 a pound.
Hog futures for April settlement increased 0.2 percent to 81.125 cents a pound. Prices fell 9.3 percent last month, the biggest decline since July.
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