Cattle Mostly Firm on Short Covering

Chicago Mercantile Exchange live cattle futures were mostly higher on Friday, lifted by end-of-week short covering following a decline to nine-month lows a day earlier, traders said.

Futures, however, remain anchored by plentiful supplies of market-ready cattle and weak cash markets as fed cattle in the U.S. Plains this week traded about $1 to $2 per cwt lower than a week ago at around $105 per cwt.

"It still looks like we have a few weeks of pressure left in front of us in September with rising cattle numbers seasonally," said Rich Nelson, chief strategist with Allendale Inc.

"Next week we will have a push of higher (cattle) numbers available for packers to buy. I think this market is bracing for this next round of lower prices," he said.

The most-active CME October live cattle contract was the only lower contract, settling down 0.250 cent at 105.150 cents per pound. Deferred contracts were 0.300 to 0.775 cent higher.

Feeder cattle futures also edged up, following gains in live cattle and as corn futures resumed a recent decline that could lower costs for fattening cattle.

Most-active CME October feeders closed 0.250 cent higher at 143.550 cents per pound while November ended up 0.275 cent at 143.950 cents.

Lean hog futures settled mostly higher, underpinned by expectations for a seasonal increase in packer demand as they fill orders this month for National Pork Month features in October. 

Front-month October hog futures finished 0.050 cent higher at 61.450 cents per pound and December hogs up 0.025 cent to 58.050 cents.

Markets will be closed on Monday for the U.S. Labor Day holiday.