Cattle gain as unemployment drop may boost demand
Sunday, 7 February 2010
CHICAGO, Feb 6 (Bloomberg): Cattle futures rose to a two-week high on speculation that beef demand will improve as the US job market recovers. Hogs Decemberlined.
The jobless rate in the US unexpectedly Decemberlined in January to 9.7 per cent, the lowest level since August, the Labor Department said Friday. Unemployment peaked at 10.1 per cent in October, the highest level in 26 years, while wholesale choice- beef prices sank to $1.3379 a pound, a seven-month low.
"The meat markets did get some good news in that unemployment report," said Lawrence Kane, a market adviser at Stewart-Peterson Group in Elmwood, Illinois. Retailers may be "a little more confident that meat sales will remain steady, if not improve a little bit."
Cattle futures for April delivery rose 0.325 cent, or 0.4 per cent, to 90.4 cents a pound on the Chicago Mercantile Exchange. Earlier, futures touched 91.2 cents, the highest level since January 20. The most-active contract gained 1.1 per cent for the week. Feeder-cattle futures for March settlement advanced 1.075 cents, or 1.1 per cent, to 98.325 cents a pound.
Hog futures for April settlement fell 0.2 cent, or 0.3 per cent, to 66.725 cents a pound. The price lost 2.7 per cent for the week, the third straight weekly Decemberline.
Wholesale pork rose 2.3 per cent yesterday to 69.15 cents a pound, according to the US Department of Agriculture. The price is up 2.6 per cent this year. Whole chickens sold for 83.25 cents a pound Friday, up 0.9 per cent in 2010.
The possibility that consumers will shift to chicken from pork, as export restrictions on US poultry leave more supplies available on the domestic market, may have contributed to the Decemberline in hogs, Kane said.
China, the second-largest buyer of US chicken, accused the US of dumping poultry in its market and said it will impose preliminary duties that may exceed 100 per cent on imports of the meat. An investigation showed the US caused "material damage" to local producers by selling chicken at below-market prices, the country's Ministry of Commerce said.
The jobless rate in the US unexpectedly Decemberlined in January to 9.7 per cent, the lowest level since August, the Labor Department said Friday. Unemployment peaked at 10.1 per cent in October, the highest level in 26 years, while wholesale choice- beef prices sank to $1.3379 a pound, a seven-month low.
"The meat markets did get some good news in that unemployment report," said Lawrence Kane, a market adviser at Stewart-Peterson Group in Elmwood, Illinois. Retailers may be "a little more confident that meat sales will remain steady, if not improve a little bit."
Cattle futures for April delivery rose 0.325 cent, or 0.4 per cent, to 90.4 cents a pound on the Chicago Mercantile Exchange. Earlier, futures touched 91.2 cents, the highest level since January 20. The most-active contract gained 1.1 per cent for the week. Feeder-cattle futures for March settlement advanced 1.075 cents, or 1.1 per cent, to 98.325 cents a pound.
Hog futures for April settlement fell 0.2 cent, or 0.3 per cent, to 66.725 cents a pound. The price lost 2.7 per cent for the week, the third straight weekly Decemberline.
Wholesale pork rose 2.3 per cent yesterday to 69.15 cents a pound, according to the US Department of Agriculture. The price is up 2.6 per cent this year. Whole chickens sold for 83.25 cents a pound Friday, up 0.9 per cent in 2010.
The possibility that consumers will shift to chicken from pork, as export restrictions on US poultry leave more supplies available on the domestic market, may have contributed to the Decemberline in hogs, Kane said.
China, the second-largest buyer of US chicken, accused the US of dumping poultry in its market and said it will impose preliminary duties that may exceed 100 per cent on imports of the meat. An investigation showed the US caused "material damage" to local producers by selling chicken at below-market prices, the country's Ministry of Commerce said.