LIVESTOCK-CME cattle futures up on tight supply, rising beef prices

By Heather Schlitz CHICAGO, Dec 22 (Reuters) - Chicago Mercantile Exchange live and feeder cattle futures moved higher on Monday on expectations of a continued tight supply of cattle and rising wholesale beef prices, analysts said. On Friday, the U.S. Department of Agriculture released a relatively bullish Cattle on Feed report showing the number of cattle placed on feedlots was lower than in the previous year and below trade estimates, contributing to expectations that cattle supply will remain low in the new year. Boxed beef prices have continued to rise and resilient consumer demand has continued to support rising cattle prices, though market players will continue to closely assess consumer willingness to pay up for pricey beef. “We’re still looking at this question of whether demand will hold up to expectations,” said Rich Nelson, chief strategist at Allendale. “We’re ending the year with very valid concerns about consumer demand.” CME February live cattle (LCG26) settled 0.625 cent higher at 231.425 cents per pound. March feeder cattle (FCH26) ended 1.1 cents higher at 340.50 cents per pound. Wholesale boxed beef prices climbed as of Monday morning. Choice cuts of beef rose $1.10 to $362.73 per hundredweight, according to USDA data. Select cuts rose $6.02 to $352.04 per cwt. Meanwhile, CME benchmark February lean hog futures (LHG26) rose 0.85 cent higher at 85.35 cents per pound. The size of the U.S. hog herd was about 0.9% smaller on December 1 compared to a year earlier, a Reuters survey of analysts showed on Monday, ahead of the USDA quarterly Hogs and Pigs report. The report is due at 2 p.m. CST (2000 GMT) on Tuesday. Wholesale pork cutout prices were lower. The USDA reported that pork carcasses were down 74 cents to $99.02 per cwt.