Chicago Mercantile Exchange (CME) feeder cattle futures rallied on Thursday to a record high on strong cash market prices and tight supplies linked to the US suspension of Mexican imports due to the spread of screwworm south of the border, reported Reuters.
Live cattle followed feeders higher, posting new contract highs in deferred contract months, although gains were limited by weaker cash beef prices and poor packer margins.
Beef export concerns also restrained gains in live cattle following data showing record Brazilian beef shipments to China, the fourth-largest importer of US beef last year. China has halted most US agricultural imports amid trade tensions with Washington.
"Tight inventory levels continue to support feeder cattle, as is the lack of a negative impact from the announcement of a vaccine for New World Screwworm. This weighed heavily on feeder cattle when announced but has since lost its impact as imports from Mexico remain suspended," said Karl Setzer, partner at Consus Ag Consulting.
Benchmark CME November feeder cattle settled 5.225 cents higher at 374.050 cents per pound. The lightly traded spot October contract peaked at 375.150 cents per pound, the highest level on record for a front-month contract.
CME December live cattle rose 1.025 cents to end at 239.900 cents per pound.
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