By Theopolis Waters
CHICAGO, Aug 7 (Reuters) – Chicago Mercantile Exchange live cattle futures fell sharply on Thursday, pressured by lower prices for cash cattle, traders said.
Cash cattle in Texas sold at $161 per hundredweight (cwt), down $1 from last week, feedlot sources said. They reported cash sales in Kansas of $160, $3 lower than a week ago.
Cash prices suffered as packers cut kills, and pulled from animals contracted against the futures market, to offset overall tight supplies.
Fund liquidation and sell stops at times dropped August and October futures down by their maximum 3-cents per pound daily price limit.
On Thursday, Russia said it will ban agricultural and meat products from several countries, including the United States, lasting for one year beginning Aug. 7.
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Meat industry and trade sources said Russia’s meat import ban on the United States would have virtually no impact on the U.S. pork and beef industry.
U.S. beef and pork have been effectively shut out of the market since February 2013 in a dispute over the use of such feed additives as ractopamine, said U.S. Meat Export Federation spokesperson Joe Schuele.
Pork from the United States has also been out of the Russian market until March of this year, but has been increasing, he said.
Traders said some investors may look at Thursday’s selloff as a buying opportunity on Friday.
August live cattle closed 3.000 cents per lb. lower to 155.550, and October 2.950 cents lower at 153.000 cents.
CME feeder cattle nearby contracts ended down the three-cent price limit, pressured by live cattle futures losses and fund selling.
August and September closed 3.000 cents per lb. lower at 218.325 and 217.725 cents.
HOGS EXTEND LOSSES
CME hogs slumped, weighed down by lower prices for heavy-weight market-ready animals, traders said.
They said, farmers have rushed hogs to market ahead of time, expecting prices to trend lower based on recent slaughter rate increases.
The afternoon’s average price of hogs in Iowa/Minnesota fell $1.34 per cwt from Wednesday, to $114.77, the USDA said.
Fund selling and sell stops sank nearby hog contracts to multi-month lows.
Futures were swayed more by fundamental market factors than Russia’s announced meat ban, traders said.
“It is more psychological than anything … they have not been a big U.S. pork importer for some time,” said independent livestock futures trader Dan Norcini.
CME hog contracts may be poised for a short-covering bounce ahead of the weekend, traders and analysts said.
August closed down 1.175 cents per lb. to 115.225 cents, and October ended 1.950 cents lower at 100.250 cents.
