CME: Futures Firm For February and April, Far Deferreds Strong on Tuesday
US - Live cattle futures ended mixed on Tuesday, with February and April futures firmer, June through October slightly lower and far-deferreds slightly higher, write analysts at Profarmer and the Chicago Mercantile Exchange.
6 February 2013
2 minute read
Nearby futures were supported throughout the day by the tightening supply picture, with additional support coming from indications the boxed beef market is in the process of confirming a near-term low has been posted, concluded the Profarmer summary.
April cattle closed slightly higher and June slightly lower on the day as a positive tilt to the cash market outlook and higher beef prices helped to provide support.
Futures closed near the lows, however, as traders saw the premium structure of the market as a limiting force. Packers are cutting back on kills and this may have helped support.
The market was trading higher on the day into the pit opening and has saw choppy to lower trade for much of the session. Strength in the stock market and a general perception that beef supply will tighten ahead helped to provide underlying support.
Ideas that deliveries will be well demanded helped to support February cattle to trade near 50 higher on the day into the mid-session. There is some rain in the forecast for the central plains into the weekend which is a change in weather which might disrupt the recent trend of near perfect weight-gain weather.
Weak margins from packers and sluggish beef prices remain a concern but traders see steady to firm trade for the cash market this week with many expecting cash to trade $1.00 higher.
Boxed-beef cut-out values were up $1.26 at mid-session to $184.00 which is down from $186.89 last week. Slaughter came in a little lower than expected at 121,000 head.
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