CHICAGO, Nov 5 (Reuters) – Chicago Mercantile Exchange live cattle futures lost ground for a third consecutive session on Thursday, pressured by slack wholesale beef demand and preliminary cash price weakness, traders said.
Spot December finished at 134.400 cents per lb, down 2.825 cents, and February 2.750 cents lower at 136.900.
On Thursday, packers in Iowa paid mostly $131 per cwt for market-ready, or cash, cattle, down as much as $3 from most of last week’s sales in the state, feedlot sources said.
They said elsewhere in the U.S. Plains, processors have not bid for cattle in feedyards that priced animals at $140 per cwt. A week ago, cash cattle in the U.S. Plains moved at $133 to $138.50.
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“The cash market seems to have run out of steam as everybody got pepped up about the potential for higher prices,” said Brock Associates Inc. analyst Doug Houghton.
Processors resisted raising cash bids after recent strong cattle prices and tepid wholesale beef demand dipped their margins in the red.
Thursday morning’s wholesale choice beef price fell 66 cents per cwt from Wednesday to $219.48. Select cuts dropped 47 cents to $209.22, the U.S. Department of Agriculture said.
Funds sold the December contract, and simultaneously bought deferred months, ahead of similar moves expected on Friday in association with the Standard & Poor’s Goldman Sachs Commodity Index (S&PGSCI).
Friday is the first of five days of the process known as the S&PGSCI “roll.”
CME live cattle market selling sank feeder cattle contracts for a third day in a row, with spot-November closing at 181.625 cents, 4.525 cents lower.
HOG FUTURES END LOWER
CME lean hogs slid to new contract lows after falling cash and wholesale pork prices beat back early-session bargain hunting, traders said.
Spot December closed 1.975 cents per lb lower at 55.400 cents, after marking a new contract low of 54.875 cents. February ended 1.425 cents lower at 58.600, after posting a fresh low of 58.025 cents.
Cash hog prices in the western Midwest on Thursday morning sank $2.45 per cwt from Wednesday to $57.79, the USDA said.
Separate government data showed the morning’s wholesale pork price was down 85 cents per cwt from Wednesday to $75.56, led by the $4.07 drop in rib costs.
Abundant seasonal supplies allowed packers to fill inventories through the weekend, including what is expected to be a roughly 180,000-head Saturday slaughter, said traders and Midwest hog dealers.
