Chicago | Reuters — Chicago Mercantile Exchange cattle futures eased on Monday, pressured by forecasts for better weather in the U.S. Plains following snowstorms and bitter cold in the past week, traders said.
“The big thing in the cattle was a real clear message that we have a sharp increase in temperatures coming up in the U.S. Plains,” said Rich Nelson, chief strategist with Allendale Inc.
Weather concerns had pushed live cattle futures to new contract highs last week, leaving the market ripe for some profit taking.
Although the weather was still cold across much of the region on Monday morning, most traders expected that damage from the storms had already been priced into the market and were focused on the outlook for a warm-up of 25 to 30 F (-3.9 to to -1.1 C) in the coming days, Nelson added.
CME February live cattle finished 1.4 cents lower at 125.125 cents/lb. and most-active April cattle ended down 1.3 cents at 126.075 cents (all figures US$).
CME March feeder cattle was 1.275 cents lower at 141.55 cents/lb. The contract bottomed out at its lowest since Dec. 7 during the session.
Hog futures were narrowly mixed, trading both sides of unchanged as traders awaited more certainty about demand from China.
The Trump administration rejected an offer from China for preparatory trade talks this week ahead of high-level negotiations scheduled for next week, the Financial Times reported on Tuesday, citing people briefed on the talks.
Beijing imposed duties on imports of U.S. pork, soy and other farm products last year, part of tit-for-tat tariffs that have disrupted hundreds of billions of dollars of commerce. U.S. pork exports to China suffered as a result, but a trade deal could help increase shipments.
CME February lean hogs edged up 0.25 cent to 61.475 cents/lb. Most-active April hog futures eased 0.175 cent to 66.1 cents.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.