chicago / reuters / U.S. live cattle futures fell to a 2-1/2-month low the last week in September in a broad-based sell-off sparked by renewed concerns about the global economy that led to safe-haven investing in the dollar at the expense of other investments such as cattle, traders and analysts said.
“It’s a technical meltdown in cattle right now and a global meltdown. Slowing of the economies in Europe, China, Japan and the U.S. is causing a sell-off of about everything, including cattle,” said Dennis Smith a broker for Archer Financial.
“Cash is weakening too. Kansas cash cattle traded at $123, down $3 from the previous week.”
Falling corn prices, signifying cheaper feed costs, encouraged buying of live cattle, feeder cattle and hog futures, the traders said, which helped limit the price slide of each.
“Corn is retreating so you’re starting to see better demand for feeders. We’re hearing reports of better corn yields and the government’s stock report could show more corn than expected,” said Jack Salzsieder, analyst for K&S Financials.
Salzsieder also said the lower feed prices should begin to slow cattle herd liquidation, leading to a more stable wholesale and retail beef market.
“Cattle numbers are already down. I think the liquidation phase should be slowing and wholesale beef should be starting to firm up,” Salzsieder said.
Libya lifts ban on Canadian cattle
Reuters / Libya has lifted its nine-year ban on Canadian cattle, dating back to a discovery of mad cow disease in Canada in 2003, the federal government has announced.
The new market is worth up to a relatively small $3 million annually, and is the most recent in a string of such announcements of new trade access for Canadian cattle or beef.
The Canadian cattle industry in the past year has gained market access for cattle to the Philippines, Ukraine, Vietnam, United Arab Emirates and Azerbaijan, and access for beef to South Korea and Peru.
Russia also this month lifted a five-year-old ban on breeding cattle from the western Canadian province of British Columbia.