By Theopolis Waters
CHICAGO, Aug 8 (Reuters) – Chicago Mercantile Exchange live cattle futures closed down the maximum 3-cents per pound allowed under the daily price limit on Friday, pressured by steady to lower returns for unsold market-ready or cash cattle based on sales earlier in the week.
On Friday, cash cattle in Texas moved at $160 per hundredweight (cwt), down $1 from Thursday and $2 lower than last week, feedlot sources said. Cash cattle in Kansas fetched $160, steady compared to Thursday and down $3 from a week ago, they said.
Read Also
Feed Grains Weekly: Price likely to keep stepping back
As the harvest in southern Alberta presses on, a broker said that is one of the factors pulling feed prices lower in the region. Darcy Haley, vice-president of Ag Value Brokers in Lethbridge, added that lower cattle numbers in feedlots, plentiful amounts of grass for cattle to graze and a lacklustre export market also weighed on feed prices.
Feedlot sources reported Nebraska cash sales of $160 per cwt., $4 lower than Wednesday’s trade and down $2 to $4 from last week.
Given future’s limit-down trade two days in a row, the market may be looking ahead to possible lower cash prices next week, said KIS Futures vice president Lane Broadbent.
Packers lowered cash cattle bids and curbed slaughters to compensate for generally tight supplies. Processors avoided spending more for supplies in response to this week’s futures losses, hastened by fund liquidation.
The beef cutout moved lower after packers discounted prices to attract retailers looking to stock meat cases for Labor Day holiday grilling demand.
Friday afternoon’s choice wholesale beef price dropped $1.96 per pound from Thursday to $260.45. Select beef slumped $2.26 to $253.00, the U.S. Department of Agriculture said.
Bearish fundamental news hurt CME live cattle futures as investors continued to ponder long-term beef and pork demand implications after Russia banned meat imports from the West.
“Nobody really has a clear handle on the Russian thing, so that’s still hanging over the livestock markets,” a trader said.
Live cattle August and October closed down three cents per lb. at 152.550 and 150.000 cents, respectively.
CME feeder cattle took its cue from live cattle limit losses and talk of lower prices for feeder cattle in some local markets.
August and September also closed three cents per lb. lower at 215.325 and 214.725 cents.
HOG FUTURES DOWN AFTER WILD RIDE
CME hogs closed lower, pressured by weak cash and wholesale beef values as heavy hogs mitigated lost production pegged to the deadly pig virus on U.S. farms, traders said.
August closed down one cent per lb. to 114.225 cents, and October ended 0.925 cent lower at 99.325 cents.
The afternoon’s average price of hogs in Iowa/Minnesota dipped 15 cents per cwt from Thursday, to $114.32, the USDA said.
Separate government data showed the afternoon’s wholesale pork price at $124.99 per cwt, $1.43 lower than Thursday.
Futures’ attempt at a pre-weekend short-covering rally faded in the face of the live cattle market’s abrupt selloff.
“Hogs have been trying … but the cattle being limit down makes it hard to build any bullish enthusiasm,” a trader said.
