Cattle Futures Prices Gain
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A report showing that fewer cattle are being fed for slaughter sent futures prices soaring Tuesday with some contracts advancing the limit allowed for daily trading.
The Agriculture Department said after the close of trade Monday that its survey of cattle on feed in seven major states showed fewer animals on the lots than had been expected, fewer placements in May and more animals sold than was believed.
“There was a lot of big buying after the cattle-on-feed report,” said Philip Stanley, an analyst in Chicago with Thomson McKinnon Securities Inc.
While there wasn’t much help from the cash beef or carcass markets, “the report didn’t give shorts--traders with a net balance of sales over purchases--much reason for being short,” Stanley said.
The limit-up moves at the Chicago Mercantile Exchange came about partly because on Monday traders were caught selling on the mistaken belief that the cattle-on-feed report would be bearish, analysts said.
Grain and soybean futures prices rallied strongly but later surrendered much of the gains on the Chicago Board of Trade.
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