Commodities Tuesday, Feb. 17, 1987 : Cattle Futures Prices Rise

Cattle futures prices rose Tuesday as meat packers entered the market aggressively.

On other markets, coffee futures dropped sharply, precious metals declined and energy futures were mostly lower. Corn prices advanced, while wheat and soybeans were mixed.

Some cattle contracts rose the daily limit of 1 1/2 cents a pound on the Chicago Mercantile Exchange.

“Cattle futures caught a lot of people off guard,” said Philip Stanley, an analyst in Chicago with Thomson McKinnon Securities Inc. “The broad consensus was probably that the market would open a little lower,” he added.

After the close on Friday, the Agriculture Department issued a cattle on feed report showing the number of animals on feedlots in seven major cattle states being close to what was anticipated.

“But the floor under estimated packer demand,” Stanley said. “The $64 (per 100 pounds) paid in the Texas Panhandle” came as a surprise to futures traders.

As the session progressed, he said, the market began to look ahead to later in the week when prices are expected to rise for beef carcasses and possibly increases for boxed beef.