Chicago | Reuters – U.S. livestock futures were widely mixed on Thursday, with nearby live cattle and lean hog contracts hitting multi-week lows in bear-spreading as traders moved into deferred positions.
Worries of weaker prices in cash markets for cattle and hogs further weighed on front-month contracts while the third of the five-day Standard & Poor’s Goldman Sachs Commodity Index roll buoyed back months, traders said.
“Hogs were completely impacted by the Goldman roll,” independent livestock futures trader Dan Norcini said.
Front-month Chicago Mercantile Exchange December lean hog futures settled 0.375 cent lower at 63.175 cents per pound, lowest since Oct. 18. Most other hog contracts were higher, with February rising 0.475 cent to 70.225.
The deferred contracts gained despite cash hogs trading down 79 cents to $60.04 per cwt in the top market of Iowa and southern Minnesota. Wholesale pork prices were up 65 cents to $81.32 per cwt, according to U.S. Department of Agriculture data.
Live cattle at two-week low
CME December live cattle fell 0.450 cents to 122.475 cents per pound, lowest in about two weeks, while February live cattle eased 0.050 cent to 128.525 cents and most other contracts notched small gains.
December cattle has declined each day this week, easing in part on worries that beef packers were unlikely to pay higher prices for cattle in Plains cash markets. Cash cattle traded earlier this week at about $124 per cwt, down $1 from last week.
“We’re still trading disappointment with the $124 bids,” Norcini said. “Can packers push the prices high enough on the wholesale level to put some better cash prices on the table? That’s what we’re going to find out.”
Choice-grade wholesale beef prices were down 39 cents to $212.74 per cwt, still hovering near a roughly four-month high, USDA data showed.
Feeder cattle futures were higher, rebounding from earlier two-week lows on support from declining corn prices.
Chicago Board of Trade corn futures notched life-of-contract lows after USDA in a monthly report hiked U.S. yields and production estimates more than analysts anticipated. Cheaper corn reduces animal feed costs for cattle ranchers, potentially boosting demand for cattle to fatten for slaughter.