Cattle futures closed at their highest level in a year after prices rose at an online auction.
Futures have rallied for 10 consecutive days to close the gap with cash prices, which have been buoyed by strong consumer demand for beef.
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April live cattle futures rose 0.9% to $1.27925 a pound at the Chicago Mercantile Exchange. That was the highest close for a front-month contract since April 18 last year.
Cash prices at Wednesday morning's Fed Cattle Exchange auction, meanwhile, averaged at $1.29 a pound, as packers bought 701 cattle. That was a marked improvement from the previous week, where 120 cattle moved at a going rate of $1.26 a pound.
The U.S. Department of Agriculture reported that more cash trade took place in the southern plains. Prices ranged from $1.30 to $1.32 a pound, gains of as much as 4 cents a pound from last week.
That could give futures prices further room to rally as traders try to meet going rates on the cash markets, analysts say.
"There is nothing to indicate a near-term top has been put in," said Troy Vetterkind of Vetterkind Cattle Brokerage, adding that high prices would likely continue to be supported despite any near-term setbacks.
Hog futures fell for a third consecutive day, with the CME June lean hog contract dropping 2.2% to 69.950 a pound. That is the lowest close for June futures since Oct. 21.
Prices on the cash market are into their fourth week of decline, ending Tuesday at 55.24 cents a pound, compared with highs of more than 67 cents in mid-March.
Growing inventories of hogs have given packers the ability to dictate price levels, analysts say, but processing margins of above $30 a head created the potential for a reversal.
"We have seen a lot of pressure in the hog market and we are due for a bounce," said Craig Turner, a broker at Daniels Trading.
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(END) Dow Jones Newswires
April 19, 2017 15:32 ET (19:32 GMT)