Chicago | Reuters — Concerns about red-hot U.S. inflation knocked down Chicago Mercantile Exchange live cattle and feeder cattle futures on Monday, as rising prices threaten beef demand, analysts said.
Demand is most at risk for expensive steaks and other pricey cuts as some consumers shift to buying cheaper items, analysts said.
U.S. consumer prices accelerated in May as the cost of food soared, leading to the largest annual increase in nearly 40-1/2 years. Read full story
CME June live cattle ended down 2.2 cents at 134 cents on Monday (all figures US$). The most-active August contact tumbled 2.325 cents to close at 133.875 cents and hit its lowest price since June 1. The contract has backpedaled since jumping on Thursday to its highest price since April 27 at 137.95 cents.
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CME August feeder cattle sank 3.15 cents to finish at 171.325 cents/lb. and touched its lowest price since June 2.
The cattle markets came under spillover pressure from sell-offs in global stocks as U.S. inflation fueled worries about even more aggressive policy-tightening, brokers said.
Traders also digested reports of extreme heat stressing and killing some cattle in feedlots in Kansas.
“On the Plains, scorching heat has spread northward, following a blazing-hot weekend in Texas and environs,” the U.S. Department of Agriculture said in a daily weather report.
In other news, July lean hog futures rose 1.2 cents to end at 106.675 cents/lb. The contract recovered after falling earlier to its lowest price since May 16.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.
