Chicago | Reuters — Chicago Mercantile Exchange live cattle futures extended losses on Friday on long liquidation that also dragged down corn futures, analysts said.
It was the second consecutive day that cattle futures followed declines in the Chicago Board of Trade corn market, which has retreated from eight-year highs reached last week.
“Cattle got caught up in the liquidation,” said Matt Wiegand, a commodity broker for FuturesOnes.
CME June live cattle futures settled down 0.3 cent at 115.3 cents/lb. (all figures US$). August live cattle slid 0.575 cent to 118.825 cents.
The decline in corn futures helped boost CME’s feeder cattle market, traders said, by easing concerns about high costs for livestock feed.
August feeder cattle finished up 0.65 cent at 151.15 cents/lb.
At the CBOT, July corn settled 31 cents lower at $6.43-3/4 per bushel.
Cheaper corn can boost profit margins for cattle feeders, who have grappled recently with soaring feed costs and complained about huge profit margins for meat packers.
Beef processors enjoyed margins of $752.25 per head of cattle, up from $732.80 per head a week ago, according to livestock marketing advisory service HedgersEdge.com.
Prices for choice cuts of boxed beef rose by 16 cents, to $316.94 per hundredweight (cwt), while select cuts dropped by $2.72, to $293.19/cwt, according to the U.S. Department of Agriculture.
“The beef values have held up well, but it looks like the rally may be coming to an end there,” Wiegand said.
In the lean hog market, CME June futures settled down 1.375 cents at 108.725 cents/lb.
In China, the world’s biggest pork producer, the sow herd in April grew 1.1 per cent from March and 23 per cent from a year earlier, according to state television.
China has been trying to rebuild its herd since it was first hit in 2018 by a devastating outbreak of the pig disease African swine fever, which increased the country’s meat imports.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.