Chicago | Reuters — CME live and feeder cattle futures firmed on Monday, supported by lower corn futures, an input cost to feeder cattle, analysts said.
“The big driver there was just lower corn,” said Josh Steinhilber, broker at Cattlehedgers.com. “We got spillover into the live cattle.”
CME August feeder cattle added 5.8 cents, to 174.075 cents/lb., while CME June live cattle futures firmed 2.55 cents to settle at 135.2 cents/lb. (all figures US$).
Live cattle futures remain underpinned by herd reductions, though threats to demand could minimize the impact of fewer cattle this fall.
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“The market is trying to build in more potential issues for the fall, lower cattle numbers,” said Steinhilber. “but if these higher prices at the super market continue into the fall, it might not be an issue that we don’t have the cattle we need.”
Consumer demand continues to support wholesale beef prices despite trending lower last week, with choice cuts adding $1.77, to $262.55/cwt., while select cuts firmed 26 cents, to $248.23/cwt.
Cattle slaughter to start the week eased versus a week ago, with 115,000 head processed.
Meanwhile, CME lean hog futures eased, pressured by protracted lockdowns across China, weakening U.S. exports to its top agricultural export customer.
Benchmark June lean hogs eased 1.4 cents, to 104.975 cents/lb. The contract hit its lowest since Jan. 20, nearing its 200-day moving average.
Hog slaughter surged past week-ago and year-over-year pace, with 482,000 head slaughtered, 17,000 more than last week and 8,000 over the same week in 2021.
CME’s lean hog index, a two-day weighted average of cash hog prices, fell four cents, to $101.77/cwt.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.
