Chicago | Reuters — Chicago Mercantile Exchange feeder cattle futures were sharply higher on Monday as corn futures on the Chicago Board of Trade took a dive, according to Don Roose, president of U.S. Commodities.
Most active Chicago corn Cv1 fell alongside soybean and wheat futures, as U.S. President Donald Trump said in an interview with the Financial Times published on Sunday that he could delay a summit with China’s President Xi Jinping later this month as he presses Beijing to help unblock the Strait of Hormuz.
Lower corn prices can signal cheaper animal feed, supporting feeder cattle.
WHY IT MATTERS: Lower corn futures signal potential relief on feed costs for Canadian cattle producers, while tight continental supplies continue to support strong feeder prices on both sides of the border. The JBS strike in Colorado further tightens North American beef packing capacity at a time when Canadian ranchers are already navigating historically low herd numbers.
Meanwhile, the anticipation of Friday’s Cattle on Feed report from the U.S. Department of Agriculture added support as the report is expected to show continuing tight cattle supplies, said Roose.
JBS workers strike in Colorado
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Beef packers have scaled back production in recent weeks and traders are monitoring developments at a large JBS meatpacking plant in Greeley, Colo., where workers have gone on strike.
The dispute reduces U.S. beef production capacity at a time when consumers face record prices for hamburgers and steaks and Trump has struggled to make good on a pledge to cool costs.
The workers have launched a two-week strike and will remain on the picket lines until JBS negotiates fairly with workers, according to the union.
Beef prices soared after a years-long drought burned up grazing lands and drove ranchers to slash their herds to the lowest level in 75 years.
Chicago Mercantile Exchange April live cattle settled 2.35 cents higher at 233.25 cents per pound (USD). April feeders finished up 12.30 cents at 355.45 cents per pound.
Beef packer margins rose to US$57.10 per head on Monday, up from gains of $45.20 on Friday, and losses of $117.95 a week ago, according to livestock marketing advisory service HedgersEdge.
CME lean hog futures ended up 0.05 cents at 93.50 cents per pound.
