Cattle futures rose to a five-month high on increased demand as retailers buy meat for Labor Day, the last U.S. holiday of the year that is warm enough to encourage outdoor grilling. Hog prices also climbed.
Wholesale-beef prices increased 0.7 percent yesterday to $1.9028 a pound, the highest in almost four weeks, government data show. Demand tends to rise before Labor Day, which falls on Sept. 2 this year, and is the third most popular day for barbecuing in the U.S., according to the Hearth, Patio and Barbecue Association.
“Labor Day buying is moving the market higher,” Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa, said in a telephone interview.
Cattle futures for October delivery added 0.2 percent to $1.277 a pound at 9:34 a.m. on the Chicago Mercantile Exchange, after reaching $1.2855, the highest for a most-active contract since March 13.
On Aug. 7, Tyson Foods Inc., the biggest U.S. meat processor, said it would stop buying cattle fed Zilmax, a feed supplement made by Merck & Co., after finding lame livestock in its factories. “There’s still a swirl around this growth additive that Tyson isn’t going to buy anymore supporting the market,” Roose said.
Feeder-cattle futures for September settlement advanced 0.1 percent to $1.572 a pound.
Hog futures for October settlement increased 0.1 percent to 86.3 cents a pound on the CME, heading for the second straight gain.