CHICAGO, June 20 (Reuters) – U.S. live cattle futures tumbled to the lowest levels in more than four years on Monday as weak cash cattle prices and declining beef values underscored worries of flagging demand, traders and analysts said.
Feeder cattle extended losses to a fresh three-year low while lean hogs trimmed declines to finish mixed at the Chicago Mercantile Exchange, with hotter-than-normal temperatures contributing to reduced meat demand for outdoor
grilling in the United States.
“There’s a lot of heat in the Midwest and that’s slowing down grilling. With the heat, feedlots are trying to move cattle aggressively (to slaughterhouses), and that’s putting more meat on the market than normal,” said Don Roose, analyst at U.S. Commodities in Iowa.
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Most-active August live cattle fell to a lifetime low of 109.575 cents per cwt, before paring losses to settle 2.300 cents lower at 110.250. CME August feeder cattle finished 0.750 cent lower at 136.675 cents per lb after trading at a
life-of-contract low of 134.250.
Live cattle on a continuous chart early in the session knocked out its lows from early May to fall to the lowest point since May 2012.
The U.S. Department of Agriculture after the close of trading pegged wholesale choice-grade beef at $219.57 per cwt, down $2.26 from Friday and the lowest prices in a month.
Wholesale pork edged up 20 cents to $87.90 per cwt, led by gains in prices for pork loins.
Lean hog futures finished narrowly mixed, following a round of profit-taking in the wake of last week’s roughly 1-1/2 year highs. Rising pork demand, especially to top consumer China, has fueled speculative bets of further gains in hog prices. CME August hogs settled 0.225 cent lower at 88.950 cents per
lb.
Investors were tweaking their positions ahead of Friday, when USDA will release monthly Cattle on Feed and Cold Storage reports in addition to a quarterly Hog and Pigs report, with the releases giving indications on how much meat is available or soon will be.
Early indications were for a large spike in the amount of cattle placed in feedlots during May.
“Cattle on Feed will be construed as bearish and people are anticipating that,” said cattle broker Brock Thompson of Tru Trader Co.
