Strength in Livestock Markets Lifts Feed and Grain Prices

Feed and grain markets were mostly higher on Tuesday as a rally in livestock futures contributed to gains in most contracts. Most livestock futures gained about one percent, but nearby lean hog contracts rose more than 1 1/2 percent, and deferred live cattle contracts gained less than 1/2 percent. The strength in livestock prices suggests producers can pay more for feed and may have an economic incentive to keep animals on feed longer before selling them to processors.

In addition to the strength in livestock prices, gains in soybean oil and soybean meal helped lift soybean futures to increases of about 1/2 percent (May contract +5 3/4 cents per bushel). Although most contracts finished about 1/2 percent below the highs of the day, the benchmark contract rose to its highest level since March 10. Early strength in…