By Kelsey Gee
CHICAGO--Prices of U.S. cattle futures ended narrowly higher on
Tuesday, boosted to the highest levels in a month by hopes that
demand is strengthening after passing a seasonal low.
August live-cattle futures bounced off the session highs to
advance 0.225 cent, or 0.2%, in price to $1.48225 a pound at the
Chicago Mercantile Exchange, the highest closing price for a
front-month contract since July 9. October live-cattle futures rose
0.1 cent to $1.4820 a pound. Feeder-cattle futures for August
gained 0.1 cent to $2.1395 a pound.
Traders on Tuesday consolidated bets that demand for red meat is
on the rebound, as the summer winds down and temperatures begin to
cool, and as bargain-hunting buyers have begun to pick up deeply
discounted burgers and steaks. Futures prices surged in the past
week from one-year lows notched late in July. Some investors on
Tuesday scaled back bets on a steeper drop in the near-term, or
took profits on recent gains, constraining prices to a sideways
range for much of the trading day.
Gains in the wholesale beef market this week however have
reinforced hopes that demand for cattle is on the ascent. "A lot of
people are calling for [last week's prices to represent] a summer
cash market low, and it feels like it's come right on time," said
Christian Mayer, a market analyst at Northstar Commodity Investment
Co.
Red meat purchases typically wane during the hottest weeks of
the year, a trend that has started to reverse with cooler
temperatures reported across the Farm Belt so far this week.
"Today has been an inside day of trading," said the analyst.
Prices of hog futures also rose on demand optimism across the
livestock markets. August hog futures picked up 1.2 cents to 81.40
cents a pound, the highest close in nearly two months. Most-active
October hog futures advanced 2.025 cents to 67.35 cents a
pound.
-Write to Kelsey Gee at kelsey.gee@wsj.com
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