Chicago | Reuters — Chicago Mercantile Exchange live cattle futures fell on Monday for a third straight session, pressured by fund-driven long liquidation and expectations of rising supplies ahead based on the U.S. Department of Agriculture’s most recent monthly cattle report, traders said.
Declines on Wall Street added to bearish sentiment. The S+P and Nasdaq suffered their worst day in just over five weeks, as concerns over increased regulation for large tech companies was spearheaded by a plunge in Facebook shares.
Weak equity markets can pressure livestock markets as traders worry about a potential decline in consumer demand for pricey cuts of beef.
“It’s a red-letter day, with stocks sharply lower and everything else lower as far as meats and grains,” one livestock trader said.
April live cattle closed 1.025 cents/lb. lower at 120.225 cents, after dipping to 120.125, its lowest level since Jan. 17 (all figures US$). June ended 1.6 cents lower at 110.15.
The declines in live cattle futures losses pressured CME feeder cattle futures as well. April feeders ended down two cents per pound at 138.2 cents.
April hogs hit contract low
CME April lean hogs tumbled to a life-of-contract low, pressured by the slumping equity markets, spillover pressure from cattle and lacklustre pork demand in the midst of Lent, traders said.
Some traders also noted a seasonal uptick in hog weights, which pumps more pork into the retail pipeline.
April hogs closed down 2.3 cents/lb. at 63.15 cents, after posting a contract low at 62.975. May finished down 2.125 cents/lb. at 70.625 cents.
— Reporting for Reuters by Julie Ingwersen and Theopolis Waters.