Chicago | Reuters — The Chicago Mercantile Exchange’s cattle futures saw a second day of volatile trading on Thursday, with wide trading ranges and weaker technicals resulting in the spot live cattle contract turning lower, analysts said.
One key reason, traders said, is that a white-hot cash market may have hit its limit.
Cattle sold for $175 per hundredweight (cwt) in the South and southern Plains cash market earlier this week, according to market analysts at StoneX — with prices staying steady in Texas compared with a week ago, but $1 lower in Kansas (all figures US$).
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“As we get into the grilling season, there’s been some talk about whether maybe we’re starting to see the market putting in a little bit of a top,” said Don Roose, president of Iowa-based U.S. Commodities.
Prices for choice cuts of beef shipped to wholesale buyers in large boxes fell $1.14 on Wednesday, to $305.92 per hundredweight, while prices for select cuts also declined, according to U.S. Department of Agriculture (USDA) data.
Still, market hopes for the cash market boom to continue boosted deferred live and feeder cattle contracts, traders said.
CME April live cattle futures ended down 1.325 cents at 174.1 cents/lb., while most-active June finished up 0.75 cent at 164.35 cents.
In the feeder cattle market, all deferred contracts through March 2024 reached new contract highs on Thursday.
Most-active CME May feeder cattle hit a new contract high of 212.575 cents/lb., before settling up 1.875 cents at 212.35 cents/lb.
CME April feeder cattle settled up 0.35 cent at 205.025 cents/lb.
The hog market turned down yet again on hefty supplies and falling belly cutout prices this week: May, July and October contracts dipped to new contract lows.
CME May lean hogs closed down 1.95 cents at 76.825 cents/lb. June lean hogs settled down 1.35 cents at 85.075 cents/lb.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago.
