LIVESTOCK-CME cattle rebound on discount to cash market, firm beef prices

By Karl Plume

CHICAGO, Aug 11 (Reuters) - Chicago Mercantile Exchange live cattle ended higher on Monday in a modest rebound from steep losses in the previous trading session, supported by strong beef prices and futures' discount to cash cattle values.

Spot August live cattle LCQ25 posted some of the session's strongest gains as cash cattle prices remain well above the futures price, even as cash cattle prices eased last week.

The market also drew support from hopes for improved beef exports as the extension of a U.S.-China tariff truce, announced at midday, eased trade tensions with the third-largest U.S. beef importer last year.

"The announcement on the U.S.-China extension I think especially helps the beef trade ... We're still trying to get back into the beef market with China, so I think that gave us an extra bump," said Mike Zuzolo, president of Global Commodity Analytics.

Resilient consumer demand for high-priced beef and a tight cattle supply have fueled recent gains in cattle futures.

The U.S. Department of Agriculture said the choice boxed beef cutout value jumped $2.68 to $381.52 per hundredweight (cwt) on Monday while select beef gained $4.52 to $359.61 per cwt.

October live cattle futures LCV25 ended 0.125 cents higher at 226.100 cents per pound. The August contract LCQ25 rose 0.525 cents to 233.075 cents, slightly narrowing its discount to the cash market ahead of the contract's expiration on August 29.

Feeder cattle futures followed live cattle higher, with actively traded September futures FCU25 ending 0.225 cents higher at 340.600 cents per pound.

CME lean hogs also advanced on Monday, lifted by short covering and recent strong export sales, most notably to China as the top pork consumer has seen its domestic hog herd contract.

October hog futures LHV25 ended 1.100 cents higher at 91.775 cents per pound.