CHICAGO, Oct 11 (Reuters) – U.S. cattle futures fell to six-year lows on Tuesday, adding to steep losses from the previous session as investors liquidated holdings amid ample animal and meat supplies, traders and analysts said.
Lean hog futures gained more than 1 percent at the Chicago Board of Trade, lifted by spreading as some traders bought back short hog positions and sold long cattle positions.
“It’s board liquidation. People want out and nobody wants in,” Alan Brugler, president of his namesake brokerage Brugler Marketing and Management LLC, said of losses in cattle futures.
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U.S. livestock: Cattle futures come down from highs
Cattle futures on the Chicago Mercantile Exchange were weaker on Monday, coming down from recent highs.
Most-active CME December live cattle futures settled 0.950 cent lower at 99.100 cents per lb, after earlier notching a lifetime low of 98.350 cents. October cattle futures fell to a low of 96.675 cents, the lowest point for a front-month contract since October of 2010.
Supplies of beef and pork are big after U.S. livestock producers expanded cattle and hog herds in recent years. The larger stockpiles have dragged down wholesale meat prices, and cattle and hog futures.
CME December lean hog futures settled 0.400 cent higher at 42.775 cents per lb, recovering a portion of their losses after hogs last week fell to seven-year lows.
“They’re awfully cheap,” Brugler said of hogs.
Thinly traded CME November feeder cattle futures were down 0.450 cent at 119.575 cents per lb while a cash feeder auction in Oklahoma City saw cattle prices trading mostly steady.
Prices for choice-grade wholesale U.S. beef edged higher, rebounding from recent multiyear lows, according to U.S. Department of Agriculture data. Wholesale pork also was narrowly higher, USDA said.
Cattle traders were awaiting deals in U.S. Plains cash steer and heifer markets, where animals exchanged hands last week at prices $1 to $3 per cwt lower than the previous week.
Additionally, USDA at midday on Wednesday is due to release monthly supply and demand outlooks, which will include updates of U.S. corn and soybean production as well as demand outlooks for beef, pork, poultry and dairy.
