Chicago | Reuters — Live cattle futures on the Chicago Mercantile Exchange (CME) fell on Tuesday for a second straight session on weak wholesale beef prices and worries about consumer demand, given uncertainty about the health of the U.S. economy, traders said.
CME August live cattle futures settled down 0.85 cent at 98.8 cents/lb. and October fell 1.1 cents to finish at 103.1 cents (all figures US$).
“There is this persistent concern about the economy that is playing into these markets,” said Altin Kalo, agricultural economist for Steiner Consulting. Noting that the CME October and December contracts fell the hardest on Tuesday, Kalo added, “That is somewhat telling that the market is concerned about demand going into the fall.”
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Cash cattle traded at $95/cwt in Texas and Kansas, the U.S. Department of Agriculture said, generally steady with last week and a disappointment to traders expecting higher prices this week.
“Some of the cash markets are not that great,” Kalo said.
Prices for choice cuts of boxed beef on Tuesday afternoon fell $2.34, to $200.92/cwt, and select cuts fell $1.03, to $190.85/cwt, according to USDA.
Hog futures closed lower, retreating after Monday’s rally. A see-saw pattern has persisted this month as traders vacillate between ample supplies of hogs, and signs of improving domestic and export demand for pork.
“There is not a whole lot of fundamental support for the hog market, at least in the near term,” Kalo said.
CME August lean hog futures settled down 1.35 cents at 49.925 cents/lb.
The U.S. pork cutout, an indication of wholesale prices, fell $1.28 on Tuesday afternoon, to $66.24/cwt.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
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