Chicago / Reuters – Chicago Mercantile Exchange live cattle futures’ extended their losses on Wednesday from the previous session, led by the morning’s lower cash and wholesale pork prices, traders said.
August live cattle ended 0.975 cent per lb lower at 109.425 cents, and October closed 1.400 cents lower at 108.075 cents.
A small number of market-ready, or cash cattle in Texas and Kansas sold at $115 per cwt, $2 lower than last week, feedlot sources said.
The morning’s choice beef price, or cutout, dropped 71 cents per cwt to $201.57 from Tuesday. Select cuts fell 83 cents to $191.53, the U.S. Department of Agriculture said.
“There is a lot of meat coming at us during the summer at a time when the demand is slow,” U.S. Commodities analyst Don Roose said regarding the cash and beef cutout price declines.
Still, bullish traders hope highly-profitable packer margins and a few processors caught short on supplies will support prices for remaining cattle.
Forecasts for extreme heat in the Plains may also slow animal weight gains and delay delivery to packing plants.
Average beef packer margins for Wednesday were a positive $31.10 per head, up from a positive $29.60 on Tuesday and a positive $21.55 a week ago, as calculated by HedgersEdge.com.
Investors are waiting for the government’s monthly Cattle-On-Feed report on Friday.
Sell stops and live cattle futures selling sent CME feeder cattle contracts lower, said traders. August feeders closed 1.275 cents per lb lower at 138.625 cents.
Hog futures end lower
Softer wholesale pork values and the cash hog price 10-day losing streak pressured CME lean hog futures, traders said. August hogs finished 1.150 cents per lb lower at 76.200 cents, and October ended down 0.425 cent at 63.875 cents.
USDA reported Wednesday morning’s average cash hog price in Iowa/Minnesota traded down $1.33 per cwt from Tuesday to $73.01 in light sales volume.
Wednesday morning’s wholesale pork price fell 94 cents per cwt from Tuesday to $90.20, the USDA said.
Repairs idled at least two packing plants earlier this week with another scheduled for maintenance on Friday, reducing their need for supplies, a Midwest hog merchant said.
Some packers trimmed operating hours to offset seasonally tight hog numbers, he said.
Meanwhile, retailers stocked up on pork in case packing plant disruptions make less product available from processors, said traders and analysts.
Editing by Alan Crosby