LIVESTOCK-Cattle futures push higher on tight supply, high beef prices

By Heather Schlitz

CHICAGO, Aug 19 (Reuters) - Chicago Mercantile Exchange cattle futures continued to rise on Tuesday as a tight supply of cattle, surging wholesale beef prices and a decrease in slaughter rates supported prices, traders said.

CME October live cattle futures LCV25 ended 0.175 cent higher at 231.35 cents per pound. September feeder cattle FCU25 rose 1.5 cents to 352.425 cents per pound.

The choice boxed beef cutout value was up $2.96 on Tuesday afternoon at $407.20 per hundredweight (cwt), according to USDA data. The select beef cutout was up $2.62 to $379.76.

Despite a sag in equity markets and concerns around consumer demand for beef, one of the priciest sources of protein, American consumers are continuing to purchase beef even as wholesale prices hit near-record highs.

Meanwhile, the closure of the U.S.-Mexico border to cattle imports has further constrained an already-tight cattle supply.

The U.S. Department of Agriculture on Friday announced it would spend $750 million to build a facility in Texas that produces sterile flies to fight the flesh-eating livestock pest.

The plan signals increasing worries about the risk of screwworm, a parasitic fly that eats livestock and wildlife alive, to infest U.S. cattle after the pest moved north in Mexico toward the U.S. border.

U.S. health officials gave the Food and Drug Administration the power to quickly authorize veterinarians and farmers to treat or prevent infestations of a flesh-eating livestock pest with animal drugs that may be approved for other purposes or available in other countries, the Department of Health and Human Services said on Tuesday.

Lean hog futures spent the session chopping up and down before settling slightly higher as traders awaited a seasonal bounce in hog slaughter.

CME October lean hogs LHV25 gained 0.025 cent to settle at 90.15 cents per pound.