Chicago | Reuters – Chicago Mercantile Exchange live cattle and lean hog futures fell while feeder cattle futures rose on year-end positioning, according to analysts, with the trade thin between Christmas and New Year holidays.
Many funds still have net long positions, said Doug Houghton, analyst at Brock Associates, “If they’re taking profits, that’s going to weigh on things,” he said.
In lean hogs, the U.S. Department of Agriculture’s quarterly hogs and pigs report last week showed larger numbers than expected, also weighing on futures, said Houghton.
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The USDA on Monday afternoon reported pork bellies fell $4.50 to $124.08 per hundredweight.
The CME benchmark February lean hog futures LHG26 fell 0.050 cent to 84.475 cents per pound.
The CME February live cattle LCG26 settled 0.675 cents lower at 228.975 cents per pound. March feeder cattle FCH26 settled 1.250 cents higher at 341.675 cents per pound.
In cattle, Houghton noted, “there’s still a lot of trepidation in the market about when the USDA might re-open cattle imports from Mexico, but it’s hard to say from day to day that that’s really a factor.”
The U.S. has been closed to those imports because of the spread of the New World screwworm parasite in Mexico, and re-opening the border would increase supplies of the animal, weighing on futures.
In boxed beef, choice cuts fell $1.88 to $349.33 per cwt, according to USDA data as of Monday afternoon. Select cuts rose $1.82 to $345.62 per cwt.
Beef packers lost $235.00 per head of cattle on Monday, according to livestock marketing advisory firm HedgersEdge.com, compared to $204.95 on Friday and $161.90 a week ago.
“Packer margins are sharply negative and it’s certainly a negative market factor,” said Houghton.
