Chicago cattle and hog futures slid on Tuesday as economic data showed signs of slowing U.S. household spending.
Most-active December live cattle closed at 235.150 cents a pound, down 1.125 cents. October contracts settled at 233.450 cents per pound, down 1.150 cents.
Most-traded October feeder cattle futures settled at 354.300 cents a pound, down 0.200 cents. November feeders closed at 349.400 cents a pound, down 0.850 cents.
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Choice boxed beef fell by $5.91 to end the afternoon at $392.62 per cwt. Select boxed beef settled at $373.17 per cwt, down $5.63.
New data from the U.S. Commerce Department’s Census Bureau showed that retail sales increased by 0.6 per cent in August, though some of the rise could be attributed to tariff-driven price increases, Reuters reported.
However, despite underlying resilience, consumption is slowing Wells Fargo economist Sam Bullard told Reuters.
“Households still generally have the means to spend, but growing concerns over the labor market suggest that we will likely see a pullback in the pace of spending growth for the remainder of the year,” Bullard said.
“So in lies the question, will beef and cattle prices continue to keep up with the pace of inflation, or will the inflation itself redirect consumer spending to a point in which some are not as willing to pay the higher price, or consume more,” wrote analyst Christopher B. Swift.
Beef demand has been hinged on nearly one million fewer employed consumers than previously believed, Swift wrote. Any further increase in inflation could be expected to harm consumers’ ability to spend.
Lean hog futures also edged down. Most-active December contracts closed at 88.225 cents a pound, down 0.625 cents. October lean hog futures settled at 97.375 cents a pound, down 0.150 cents.
Pork carcass cutout value was reported at $112.28 per cwt, down $1.79, the USDA reported on Tuesday afternoon.
