CHICAGO, Oct 5 (Reuters) – Chicago Mercantile Exchange live cattle resumed their recent downtrend on Monday after the seasonal drop in wholesale beef values trimmed last Friday’s futures gains, traders said.
Spot-October settled down 0.950 cent to 122.125 cents per lb, and December 1.150 cents lower at 130.225 cents.
Monday morning’s wholesale choice beef price, or cutout, was at $204.43 per cwt, $1.34 lower than on Friday. Select cuts fell $2.15 to $199.21, their first time below $200 since Jan. 3, based on U.S. Department of Agriculture data.
Competitively-priced pork and the surplus of heavyweight cattle contributed to declining cutout values, which took cash prices down along with them, a trader said.
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Last week, packers paid mostly $118 to $124 per cwt for market-ready, or cash, cattle, compared to $128 to $132 the week before.
Investors look for improved beef demand after grocers put October Pork Month behind them, which may help halt the further slide in cash prices.
“But as demand increases so will the number of cattle coming to market. There are still some extra heavy cattle that are looking for a home at this point,” Len Steiner wrote in his Daily Livestock Report newsletter.
Worries about possible live cattle deliveries later on Monday further weighed on October futures.
CME live cattle selling and signs of lower cash feeder cattle prices undercut the exchange’s feeder cattle contracts. October ended 1.375 cents lower at 178.125 cents.
HOGS END MIXED
CME lean hog investors sold nearby contracts and simultaneously bought deferred months stirred by uncertainty about cash and wholesale pork prices as the week progresses.
Spot-October, which will expire on Oct. 14, closed down 0.350 cent per lb to 73.000 cents, and December 0.650 cents lower at 64.725. February ended up 0.100 cent to 68.325 cents and April 72.700 cents, 0.575 cent higher.
The session’s mildly bullish market fundamentals limited nearby futures’ losses.
USDA reported Monday morning’s average cash hog price in the western Midwest at $71.52 per cwt in light volume, $1.31 higher than on Friday.
The government quoted the morning’s wholesale pork price at $86.15 per cwt, up 62 cents from Friday.
So far, historic flooding in parts of the East Coast over the weekend has not disrupted packing plant operations in the region, hog dealers and industry experts said.
On Monday, packers processed 435,000 hogs, 9,000 more than last week, according to USDA estimates.
