Chicago | Reuters — U.S. live cattle futures rebounded on Tuesday, correcting after the biggest drop since June 30, amid a stronger wholesale market, traders said.
Lean hogs stepped back for a second day, reflecting a softer cash market, while feeder cattle followed the cash market higher.
Chicago Mercantile Exchange December live cattle futures added 0.4 cent, to 111.225 cents/lb. (all figures US$).
CME January feeder cattle climbed 1.275 cents, to 136.825 cents/lb.
“I think a little bit of the correction in cattle today — and that we didn’t make up all that was lost yesterday – tends to reflect that the wholesale market is still in pretty good shape here,” said Altin Kalo, an economist with Steiner Consulting Group.
Daily cattle slaughter remained strong, with 120,000 head slaughtered, in line with yesterday and a year ago. Packer margins fell to $220.90, but remain elevated compared to pre-COVID-19 levels, according to Denver-based livestock marketing advisory service HedgersEdge.com.
Boxed beef prices were mixed, with choice cuts trimming 70 cents, to $213.92, and select cuts increasing $1.09, to $201.43.
Meanwhile, lean hog futures dropped for a second consecutive trading day, reflecting a softening cash market and heavier animal weights heading for slaughter in coming months.
“Weights are starting to move higher,” said Kalo. “Is that going to put some pressure on producers, where they’ll have to be more aggressive in marketing hogs? And if that’s the case, if they become more aggressive, that will put some pressure on the cash side.”
CME October lean hogs fell 0.375 cent, to 77.8 cents/lb. Most-active December hogs settled 0.475 cent lower at 66.15 cents/lb.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.