Chicago | Reuters — U.S. cattle futures sank to their lowest prices since May on Tuesday on fund liquidation and profit-taking, traders said.
Follow-through selling pressured the markets after losses on Monday, along with softer boxed beef prices, traders said.
The U.S. Department of Agriculture priced choice cuts of beef at $300.38/cwt, down $1.34 from Monday, and select cuts at $269.48/cwt, down 88 cents (all figures US$).
Meatpackers’ demand for cattle was a little lighter than expected to start the week, traders said.
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Packers slaughtered an estimated 125,000 cattle on Tuesday, steady with a week ago, the USDA said. Monday’s estimated slaughter of 122,000 cattle fell short of the 125,000 head processed a week earlier.
December live cattle futures settled 2.55 cents lower at 178.775 cents/lb. at the Chicago Mercantile Exchange (CME) and hit their lowest price since Oct. 26 at 178.6 cents.
February live cattle saw a bigger decline, ending down 3.55 cents at 178.425 cents and reaching their lowest price since May 30 at 177.75 cents.
CME January feeder cattle futures tumbled 5.6 cents to end at 230.825 cents/lb. and touched the lowest price since May 9 at 230.2 cents.
Projections that cattle supplies will be more plentiful than previously expected early next year hung over the markets, analysts said. Larger than expected placements of cattle in U.S. feedlots in September have boosted supply expectations.
Analysts said producers have not yet started to rebuild the nation’s herd after reducing it to the smallest size in decades this year. High beef prices and economic uncertainty threaten to reduce demand for U.S. beef, however, analysts said.
In CME’s lean hog market, December futures settled 0.5 cent higher at 72.9 cents/lb. and hit their highest price since Sept. 28 at 74.275 cents. The wholesale pork market weakened, as belly prices fell after surging on Monday.
— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.
