Chicago | Reuters — U.S. live cattle futures rose on Monday, after plunging to their lowest price in more than a month last week, amid signs of meat production increasing — even as cash market prices continue to strain livestock producers’ profits.
Chicago Mercantile Exchange August live cattle rose 0.675 cents, to 96 cents (all figures US$). August feeder cattle futures ended 0.075 cents up at 131.175 cents/lb.
In the pork market, CME July lean hog futures, the most actively traded contract, rose 0.6 cent, to 52.275 cents/lb. August futures rose 0.625 cent to 55.275 cents.
“We’re still dealing with cash discounts in the livestock futures markets, as the cash market continues to be under pressure as slaughter rates are picking up,” said Don Roose, president of U.S. Commodities in West Des Moines, Iowa.
Beef output has been improving as slaughterhouses have resumed operations, after closing temporarily in April and May due to outbreaks of the new coronavirus among plant workers.
USDA reported meat processors had slaughtered an estimated 119,000 cattle on Monday, up from 117,000 cattle a week earlier.
That cattle kill rate is expected to continue to increase as plants try to run over-capacity in the coming weeks, in order to keep production at full speed, market analysts said.
But meatpacking workers have often been absent, because they are quarantined or afraid to return to work after a severe coronavirus outbreak. Nationwide, 30-50 per cent of meatpacking employees were absent last week, said Mark Lauritsen, a vice-president for the United Food and Commercial Workers (UFCW) union.
Monday’s hog kill also improved, with USDA estimating that packers slaughtered an estimated 457,000 head — up from 445,000 head a week earlier — but was still down nearly 3.6 per cent over last year.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago.