Chicago | Reuters — Profit-taking pushed down Chicago Mercantile Exchange cattle futures on Tuesday, while front-month lean hog futures tumbled to another contract low.
Losses on Wall Street helped set a negative tone for the markets, as live cattle futures pulled back from contract highs reached on Monday, traders said.
“Cattle-wise, we got a bit overbought,” said Matt Wiegand, commodity broker for FuturesOne.
CME June live cattle ended one cent lower at 160.225 cents/lb., down from Monday’s high of 162.525 cents/lb. (all figures US$). May feeder cattle slipped 0.875 cent to finish at 202.275 cents/lb.
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Wholesale beef prices and profit margins for processors jumped.
Margins for beef processors reached $59.15 per head of cattle, up from $41.40 per head on Monday and $50.40 per head a week ago, according to livestock marketing advisory service HedgersEdge.com.
Choice cuts of boxed beef were priced at $287.94 per hundredweight (cwt), up $2.85 from Monday, while select cuts were up $3.77 at $277.95 per cwt, the U.S. Department of Agriculture (USDA) data showed.
Meat processors slaughtered an estimated 126,000 cattle, up from 125,000 cattle a year ago, and 481,000 hogs, the same as last year, USDA said.
In lean hog futures, the April contract ended 2.3 cents weaker at 72.225 cents/lb. and reached a contract low of 72.1 cents/lb. The contract has dropped 24 per cent this year.
June lean hogs, the most actively traded contract, settled 1.85 cents lower at 89.575 cents/lb.
Technical selling, adequate pork supplies and weak cash prices have weighed on futures, traders said.
“Nobody’s been rewarded for buying hogs lately,” said Wiegand. “That’s keeping the bias down.”
USDA priced the pork carcass cutout at $76.85/cwt, down $1.47 from Monday.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.
