U.S. livestock: CME live cattle end slightly lower

Chicago | Reuters — Chicago Mercantile Exchange live cattle futures settled slightly lower on Monday after touching a contract high, pressured by profit-taking, traders said.

“While nothing is really changed in the long term we’re going to see short-term fluctuations in this market,” Broadbent said.

Tight cattle supply and overseas demand for U.S. beef continue to lend support in the long term but in the short term talk of strong beef demand is starting to level off, said Lane Broadbent of KIS Futures.

Wholesale beef prices that were only slightly higher early on Monday were an indication that previously strong demand for beef may be softening.

Monday morning’s wholesale price for choice beef was at $248.34 per hundredweight (cwt), up 22 cents from Thursday (all figures US$). Select beef cuts were at $241.54/cwt, up 42 cents, according to U.S. Department of Agriculture data.

Last week, cash cattle in the U.S. Plains traded mostly at $158/cwt on Wednesday, $3 higher than the previous week.

This week’s list of cattle for sale, or the showlist, was expected to be a touch larger than the previous week, Broadbent said, which could pressure cash prices if more cattle are immediately available in the cash market.

August live cattle finished down 0.05 cent/lb. at 154.95 cents, and October was down 0.225 cent/lb. at 156.675 cents.

CME feeder cattle were supported by weak U.S. corn futures, and tight feeder cattle supply, while weak CME live cattle limited gains.

Chicago Board of Trade corn prices fell to a four-year low on Monday pressured by good U.S. crop weather.

August closed up 0.375 cent/lb. at 218 cents, and September was 0.4 cent higher at 219.225.

Hog futures close higher

CME July and August hogs finished higher supported by technical buying and higher cash market prices. CME deferred month contracts October and December jumped on supply concerns related to porcine epidemic diarrhea virus (PEDv), traders and analysts said.

U.S. Midwest hog dealers quoted higher cash hog prices early on Monday. Cash prices up at least $1 in some areas of the region combined with higher wholesale pork values lent some support to front-month contracts.

Government data showed the wholesale pork price on Monday morning at $135.36/cwt, up $1.16 from Thursday.

Market-ready hog supply has been constrained by PEDv. Tight available hog supply has forced some packers to reduce production schedules which has trimmed overall slaughter numbers.

The U.S. Department of Agriculture estimated Monday’s hog slaughter at 387,000 head, 20,000 head less than a year ago.

Livestock industry analysts expect U.S. hog supply to become even more constrained in the late summer and fall months which supported October and December contracts.

July hogs, which expires next week, closed 0.075 cent/lb. higher at 131.8, and August closed up 0.225 cent at 131.825 cents. October finished up 1.1 cent at 117.85 cents.

— Meredith Davis reports on commodity futures markets for Reuters from Chicago.

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