Feeder cattle ends firmer and hog futures close higher.
Feeder cattle ends firmer and hog futures close higher.

Chicago Mercantile Exchange live cattle futures halted a two-day slide on Friday, sparked by improved wholesale beef values and better-than-expected cash prices, said traders.

They said buy stops and technical buying furthered live cattle market advances.

CME livestock markets will be closed on Monday in observance of the Presidents Day holiday.

February live cattle closed 1.400 cents per pound to 117.925 cents, and above where the 20-day and 40-day moving averages converged at 117.421 cents. April ended 1.675 cents higher 114.925 cents, and above the 10-day moving average of 114.290 cents. 

The morning's choice wholesale beef price climbed $1.15 per cwt to $190.37 from Thursday. Select cuts rose $1.12 to $189.31, the U.S. Department of Agriculture said.

On Friday packers paid $119 to $120 per cwt for slaughter-ready, or cash, cattle in the U.S. Plains.

That was nearly inline with last week's sales.

The $120 per cwt cash results were surprising given expectations of softer prices due to poor packer profits, said West Oak Commodities analyst Tom Tippens.

He credited tight near-term cattle supplies, and an industry "on the threshold" of spring grilling demand, for underpinning cash prices.

Market participants look ahead to next week's cash sales with a few plants scheduled to be dark for Monday's holiday.

Some processors may operate reduced slaughter rates to recoup lost margins. USDA estimated last year's Presidents Day slaughter at 93,000 head.

Friday's average beef packer margins were at a negative $73.75 per head, up from negative $80.75 on Thursday, as calculated by HedgersEdge.com.

Lower corn prices and live cattle futures turnaround supported CME feeder cattle. March feeders closed up 0.250 cent per pound to 124.075 cents. 

Hog Futures End Higher

CME lean hogs also snapped two days of losses aided by short-covering, fund buying and spillover live cattle futures support, said traders.

April hogs ended 0.950 cent per pound higher at 70.775 cents. May closed 1.000 cent higher at 75.700 cents, and above the 10-day moving average of 75.385 cents.

Futures rallied despite lower cash prices amid ample near-term packer inventories.

"Packers have enough (hog) for what they need, and some of them (packers) are taking off on Monday," a Midwest hog merchant said.

Friday morning's cash hog price in Iowa/Minnesota averaged $73.75 per cwt in light sales volume, $2.16 lower than on Thursday, the USDA said.

Last year's Presidents Day holiday yielded a 424,000-head hog slaughter, according to USDA estimates.