A report said United States beef exports in December, on a carcass basis, were 258.9 million pounds, up 2.6 per cent from a year ago and 2.3 per cent more than in November.

As the U.S. and China move to impose tariffs on each other, a meeting between U.S. President Donald Trump and Chinese President Xi Jinping has been delayed.

The April live cattle contract pushed above 200 cents, gaining 2.650 cents per pound at 201.300 cents.

March feeder cattle futures was also on the upswing, adding 2.475 cents per pound at 270.725 cents per pound.

The U.S. Department of Agriculture reported wholesale boxed beef prices were lower on Wednesday afternoon, with choice boxes giving up $5.39 at $325.34 per hundredweight and select boxes lost $3.08 at $314.33.

Lean hog prices were higher on Wednesday. Exports amounting to 645.8 million pounds marked the second-best December on record. Exports bumped up 0.3 per cent from the previous December and improved 0.4 per cent from November. The April contract rose 1.800 cents per pound at 91.550 cents.

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A report said the managed funds were liquidating their long positions.

The dust-up over the United States imposing tariffs on Canada and Mexico was settled for now, with the countries agreeing to a 30-day delay. However, the Trump administration pressed ahead with tariffs on China and the latter countered with their own levies.

The April live cattle contract closed below 200 cents, as it gave up 1.500 cents per pound at 198.650 cents.

March feeder cattle futures was down 2.250 cents per pound at 268.250 cents per pound.

The U.S. Department of Agriculture reported wholesale boxed beef prices were lower Tuesday afternoon, with choice boxes stepping back $1.26 at $330.73 per hundredweight and select boxes down $2.43 at $317.41.

Lean hog prices turned around on Tuesday from yesterday’s limit-down loss that was due to the U.S. tariff threat to Canada and Mexico. Today, the April contract climbed 3.400 cents per pound at 89.750 cents as pork was omitted from China’s new tariffs on the U.S.

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The hog market was due for a correction to the upside after the most-active December contract fell 13.5 per cent from the start of the month to a seven-month low on Thursday, traders said.

“It was a pretty substantial break that we’ve had,” said Ted Seifried, chief ag market strategist for Zaner Ag Hedge Group.

CME December hogs ended up 0.6 cent at 75.05 cents/lb. and touched their highest price since Monday (all figures US$). On Thursday, the contract hit 71.275 cents/lb., its lowest price since Feb. 19.

October lean hog futures ended up 0.25 cent at 85.725 cents/lb. and topped a one-week high. The contract on Tuesday sank to its lowest price since March 4.

Some brokers said the market appears to have established a near-term floor for prices after the recent declines.

In CME cattle futures, prices weakened with boxed beef values.

Choice cuts of boxed beef tumbled by $3.53, to $314.47/cwt, while select cuts dropped 52 cents, to $279.75/cwt, according to the U.S. Department of Agriculture.

“You’ve got concerns about boxed beef prices potentially falling apart,” Seifried said.

CME December live cattle settled down 1.05 cents at 127.525 cents/lb. November feeder cattle dropped 1.2 cents to close at 156.1 cents.

In global export news, Russia imposed restrictions on Brazilian meatpackers after two atypical cases of BSE were detected this month, the Valor Economico newspaper reported.

Brazil, the world’s largest beef exporter, also temporarily suspended its shipments to its No. 1 customer China, in line with a health protocol signed between the two countries.

— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.

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“You’re still seeing boxed beef pull back, which is normal, seasonally,” said Matthew Wiegand, Risk Management Consultant at FuturesOne. “We’re past the Fourth of July — we don’t have a grilling holiday until Labour Day.”

Boxed beef prices fell, with choice cuts dropping $2.93, to $281.97/cwt, according to the U.S. Department of Agriculture, while select cuts fell $2.02, to $260.06/cwt (all figures US$).

CME August live cattle futures ended down 1.325 cents at 119.275 cents/lb., hitting its lowest price since June 11.

Cash cattle traded $1-$2 lower across the upper U.S. Plains, ranging from $119 in Kansas to $125 in Nebraska, according to USDA.

Live cattle pulled the feeder cattle market lower, despite a softer corn trade, Wiegand said.

CME August feeder cattle settled 1.675 cents lower at 157.325 cents/lb.

Meanwhile, CME hogs were mostly firm, though the most active August contract inched lower as demand cools and herd size looks to rebuild.

“The margins should be there to encourage expansion. It’s just how fast it can do it,” said Wiegand.

CME lean hog futures for August delivery ended down 0.025 cents at 100.375 cents/lb.

— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.

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The drop in futures extended a four per cent setback from a contract high that most-active August live cattle reached last month.

Prices for beef shipped to wholesale buyers in large boxes have also weakened, with choice cuts dropping by $1.78, to $284.90/cwt, on Wednesday, according to the U.S. Department of Agriculture (all figures US$). Prices for select cuts fell by $1.23, to $262.08/cwt.

“The beef market is stalled out,” said Don Roose, president of brokerage U.S. Commodities in Iowa. Prices for cash cattle that underpin the futures market have also come under pressure, he said.

CME August live cattle futures ended down 1.8 cents at 120.6 cents/lb. and touched its lowest price since June 11.

Deferred futures contracts have already dialled in a decline in the number of cattle placed in U.S. feedlots, Roose said.

In May, placements in feedlots were down seven per cent from a year earlier, according to the latest data from USDA. The data signals there will be fewer cattle available for slaughter at the end of this year and in early 2022.

“You’re just plain going to have less numbers as we go forward,” Roose said.

CME August feeder cattle settled 1.625 cents lower at 159 cents/lb.

In the pork market, CME lean hog futures for August delivery ended down 1.95 cents at 100.4 cents/lb.

USDA, in a weekly report, said average U.S. hog weights fell slightly to 276.6 lbs. in the week ended July 3. That was down 2.3 per cent from a year earlier.

— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.

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Cattle heading to slaughter weigh more, analysts said, because they put on pounds as animals backed up in feedlots when meat plants closed in April because of the outbreak of the coronavirus among meatpacking workers.

In the week ended July 4, dressed cattle on average weighed 829 lbs., up from 804 lbs. a year earlier, according to the U.S. Department of Agriculture.

“You’ve got big supplies, big weights,” a broker said.

Chicago Mercantile Exchange (CME) August live cattle settled 0.85 cent lower at 99.15 cents/lb. August feeder cattle fell 0.875 cent, to 134.05 cents/lb.

Live cattle futures have retreated since nearing a two-month high on Monday, while feeder cattle have pulled back after reaching their highest price in month than a month on Monday.

Prices for choice cuts of boxed beef on Wednesday declined 77 cents, to $204.53/cwt, and select cuts slid $1.21, to $195.63/cwt, according to USDA.

Processors such as Tyson Foods and JBS USA are working their way through the cattle that backed up in feedlots, analysts said. Plants have since reopened, although many are working at reduced capacities because employees are absent and operators implemented social-distancing measures.

Meat companies slaughtered an estimated 120,000 cattle, compared with 121,000 a week ago; 118,000 a year ago; and up to 124,000 a day in March before the plant shutdowns, according to the USDA.

Pork processors slaughtered an estimated 467,000 hogs, compared with 469,000 a week ago; 482,000 a year ago; and as many as 498,000 a day in March.

CME August lean hogs ended down 0.925 cent at 47.95 cents/lb. October hogs closed 0.175 cent higher at 48.8 cents/lb.

— Tom Polansek reports on agriculture and ag commodities for Reuters from Chicago.

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Some feedlot cattle in the central and northern Plains have traded at prices steady to firmer than a week ago, while cattle in the southern Plains were expected to trade later on Friday at least $1 per cwt higher than last week’s sales of mostly $124/cwt, traders said (all figures US$).

Seasonally tight inventories of cattle have elevated the market in recent weeks despite thinning beef packer margins. Facing strong beef demand and tightening supplies of cattle, beef packers have been buying cattle more aggressively so as not to run short.

The wholesale choice boxed beef cutout value rose eight cents to $210.04/cwt on Friday, up $1.55 from a week ago, according to the U.S. Department of Agriculture. Select cuts were $206.55/cwt, down 13 cents on the day but up $1.16 from a week ago.

Average beef packer margins widened slightly to $7.40 per head on Friday, up from $3.15 per head a day earlier, according to livestock marketing advisory service HedgersEdge.com LLC.

But margins have fallen sharply from recent highs. They were at $145.45 per head a month ago and more than $360 per head two months ago, according to HedgersEdge data showed.

Meanwhile, plunging temperatures, snow and ice are stoking concerns about slowed weight gains in cattle, traders said.

Chicago Mercantile Exchange February live cattle rose 0.7 cent to 127.425 cents/lb., the contract’s highest close since Dec. 13. April cattle were up 0.65, at 127.95 cents.

Feeder cattle followed live cattle higher, with actively traded March futures up 0.9 cent at 147.45 cents/lb.

CME lean hog futures ended mixed as the market weighed weaker pork prices and ample supplies of hogs against an expected increase in pork exports to China as part of an interim U.S.-China trade deal due to be signed next week.

The deal is expected to accelerate Chinese buying of U.S. pork as part of what the White House says is a vow by Beijing to roughly double U.S. farm goods purchases from levels seen before the trade war broke out in 2018.

CME February hogs rose 0.225 cent to 67.25 cents/lb. while April futures fell 0.35, to 74.125 cents.

— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago.

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Select-grade boxed beef was $189.21/cwt on Monday afternoon, down 2.7 per cent from a week ago, according to U.S. Department of Agriculture data issued after the close of trading (all figures US$). Choice-grade boxed beef was $213.27, down 1.9 per cent from a week earlier.

The declines signal a buildup of beef supplies before the U.S. Department of Agriculture, in a monthly report on Friday, is expected to report large numbers of cattle in U.S. feedlots, traders said. As of June 1, there were 11.7 million head, the highest figure for that date since USDA began tracking the data in 1996.

Declining boxed-beef prices also raised concerns about potential weakness in demand, said Rich Nelson, chief strategist for Illinois-based broker Allendale.

“We have concern about this wholesale beef,” he said.

CME August live cattle futures settled up 0.025 cent at 108.5 cents/lb. after reaching 108.975, the contract’s highest level since May 28. CME October cattle dropped 0.2 cent to 109.775 cents/lb.

Other deferred contracts also declined, although some traders said they were impressed the market pared losses before the close of trading.

CME August feeder cattle futures edged up 0.05 cent to 141.65 cents/lb.

In the swine market, CME August lean hog futures settled down 0.55 cent at 80.1 cents/lb. October hogs rose 0.675 cent to finish at 73.9 cents.

Expectations for China to boost meat imports supported deferred hog futures, traders said. China, the world’s top hog producer and pork consumer, is struggling to contain an outbreak of the fatal hog disease African swine fever, which has killed more than a million pigs.

China’s agriculture ministry said on Monday it will carry out checks on local veterinary authorities in 10 provinces as it tries to slow the ongoing spread of the disease.

China produced 24.7 million tonnes of pork in the first six months of 2019, down 5.5 per cent from a year earlier, according to figures from the National Bureau of Statistics, as African swine fever spread.

— Reporting for Reuters by Tom Polansek in Chicago.

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