Chicago Mercantile Exchange (CME) live cattle futures rose for a third straight day on Monday following the U.S. Department of Agriculture's monthly cattle-on-feed report last Friday, traders and analysts said.
The data showed higher-than-expected marketings in January against the first increase in the number of cattle placed on feedlots in eight months that stirred bullish spreads.
Blizzard conditions in parts of the U.S. Plains are making it difficult to transport livestock to packing plants and move fresh product to customers.
Cargill's beef processing plant at Friona, Texas was not operating on Monday because road conditions made it impossible for trucks to move cattle and beef to and from the facility, company spokesman Michael Martin said.
"Our Dodge City, Kansas, beef plant is operating only one shift today, with both shifts scheduled for tomorrow," he said.
The Tyson Foods beef complex in Amarillo, Texas, was also idled by Monday's storm, said company spokesman Gary Mickelson.
Packers on Monday processed 87,000 head of cattle, down 22,000 from a week earlier and 33,000 less than a year ago during the same period, based on USDA data.
"As a result of the storms last week and today's storm, feedlot conditions have deteriorated significantly... and cattle weights are likely to fall sharply," Hales Trading Co. president David Hales said.
Reduced slaughters since late last week slowed the movement of fresh beef to grocers and other buyers while lifting wholesale beef prices and improving packer margins.
The wholesale price for choice beef on Monday was $183.09 per hundredweight (cwt), up 20 cents from Friday; select cuts slipped five cents to $180.14, according to USDA (all figures US$).
HedgersEdge.com put the average beef packer margin for Monday at a negative $42.25 per head, compared with a negative $50 on Friday.
Investors were waiting for feedlots to count the number of cattle available for sale.
Cash-basis cattle last week fetched $123-$125/cwt, which was steady to $2 higher than the previous week, feedlot sources said.
Spot February live cattle closed at 126.95 cents per pound, 0.6 cent higher. Most-actively traded April ended up 0.2 cent to 128.425 cents.
CME feeder cattle were weakened by deferred live cattle contracts and firm corn prices.
March feeders settled 0.45 cent/lb. lower at 140.8 cents. April ended at 143.7 cents, down 0.075 cent.
Hogs rebound on weather
Hog futures posted modest gains in anticipation that cash hog prices would trend higher in the near term, which spawned short-covering, analysts and traders said.
"Packer margins have improved significantly after they lowered cash hog bids for almost a week. Weather is supposed to get worse before it gets better, so packers are going to be hurting for supplies," a trader said.
USDA data showed the average price for hogs in the most-watched Iowa/Minnesota market on Monday at $76.26/cwt, 83 cents higher than Friday.
The average pork packer margin for Friday was at a positive $5.45 per head, compared with a positive $2.95 on Friday, according to HedgersEdge.com.
April hogs ended at 81.9 cents/lb., 0.25 cent higher. June closed up 0.1 cent to 91.05 cents.
-- Theopolis Waters writes for Reuters from Chicago.