By Kelsey Gee 
 

CHICAGO--U.S. cattle futures rallied for a second-straight session Friday, lifted to a fresh three-week high by signs of stronger demand for discounted meat.

Live-cattle futures for October delivery rose 2.125 cents, or 2.2%, to settle at $1.0115 a pound, the highest settlement since Oct. 7, and marking a 5.5% jump on the week. Most actively traded December live-cattle futures climbed 1.75 cents to $1.01875 a pound on the Chicago Mercantile Exchange.

Feeder-cattle futures for October advanced 0.125 cent to $1.21875 a pound.

Cattle futures have received a boost from signs of strong exports of U.S. beef as prices have fallen in recent weeks, which have added to hopes that the discounting will stoke fresh buying interest both domestically and overseas.

Underpinning the market has also been a spate of sales in the cash markets from producers to meatpackers at steady to slightly higher prices this week, from 98 to 99.50 cents a pound live so far Friday. Other producers now are passing over those bids from buyers, emboldened by the demand signals and seeking sharply higher prices.

If meatpackers are able to clear larger volumes of beef to bargain-hungry buyers, producers may have more negotiating leverage to offer higher prices for their cattle supplies in the weeks ahead, analysts said.

The cattle and hog markets have fallen sharply this autumn, as producers fear a large supply of livestock and meat will overwhelm demand.

Hog futures got a boost, meanwhile, from buying across the livestock markets.

December hogs rose 0.75 cent, or 1.8%, to 41.85 cents a pound, down 0.9% on the week.

Write to Kelsey Gee at kelsey.gee@wsj.com

(END) Dow Jones Newswires

October 21, 2016 15:45 ET (19:45 GMT)