Cattle futures rose to their upper daily limits on Wednesday as feed prices dipped on government supply-and-demand figures.
The U.S. Department of Agriculture raised its projections for domestic and global corn stocks above expectations. That helped send futures contracts for the grain, a crucial component of cattle feed, down 4% and lowered costs for commercial feedlots to fatten their cattle.
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Feeder cattle futures for August delivery bounced 4 1/2 cents, or 3.1%, to $1.5175 a pound at the Chicago Mercantile Exchange, hitting a month-high and the upper end of its daily trading band.
CME August live cattle futures rose 3 cents, or 2.6%, to $1.17875 a pound, also reaching its daily top.
The USDA also forecast higher beef exports in 2017 and 2018 on stronger global demand.
Domestically, there were also signs of improving demand. Beef packers at the weekly Fed Cattle Exchange online auction bought almost 2,000 cattle, over four times the previous week's volume. They also paid slightly more, with prices ranging between $1.1734 and $1.1845 depending on the delivery date.
The USDA separately reported a few cattle sales in Kansas at $1.20 a pound live, an uptick from recent going rates.
That had traders betting that cattle prices could recover from a protracted slump.
CME August lean hog futures inched 0.5% higher to 82.625 cents a pound. The broader strength in the livestock markets was supportive, while higher pork prices also helped.
Pork bellies, in particular, continue to carve out new record highs, climbing just shy of $2.10 a pound on midday Wednesday.
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(END) Dow Jones Newswires
July 12, 2017 15:56 ET (19:56 GMT)