Chicago | Reuters — CME live cattle futures eased on Wednesday, retreating back toward seven-week lows hit on Monday after a bargain buying bounce fizzled as plentiful supplies remained the focus of investors.
Feeder cattle futures were slightly higher following the front-month contract’s decline to its lowest since July 1 on Tuesday.
“The cattle are just swinging back and forth after a pretty brutal fund liquidation phase,” said Dennis Smith, commodity broker at Archer Financial Services said.
CME December live cattle futures dropped 0.875 cent, to 104.575 cents/lb., settling below the low end of its 20-day Bollinger range.
January feeder cattle gained 0.375 cent, to 127.075 cents/lb.
Hog futures were weaker, but declines were limited as traders still expected demand from China to remain strong even as it seeks to rebuild its herd, Smith said.
CME December lean hogs fell 0.05 cent to 69.2 cents/lb., closing above session lows as it followed a recovery in the cash market.
The contract found support at its 10-day moving average for the second day in a row. It has not traded below that key technical point since Oct. 6.
Pork supplies during the upcoming Lunar New Year holiday in China, the world’s top consumer, will be 30 per cent higher than a year ago, an agriculture official said on Wednesday, after significant efforts to rebuild a depleted hog herd.
German pig prices were unchanged this week at 1.27 euros/kg, the association of German animal farmers VEZG said on Wednesday, despite import bans by Asian countries after African swine fever was found in the country.
— Mark Weinraub is a Reuters commodities correspondent in Chicago.