Chicago | Reuters — U.S. cattle and hog futures tumbled on Thursday on worries about demand for beef and pork as soaring coronavirus infections across the country threatened more restaurant and food service closures and forced more Americans to shelter at home.
Investors also fear a repeat of the livestock processing disruptions seen in the spring as rising COVID-19 cases at meat plants backed up livestock supplies and dragged futures prices to the lowest in a decade or more.
“There’s some demand concern coming forward after our spring mess,” said Matthew Wiegand, broker with FuturesOne. “To what degree can we hold up the processing pace? As of today, we’re not seeing major problems, but it’s in the back of everyone’s mind.”
Strong beef export sales data on Thursday morning failed to stem the drop in the cattle market, while disappointing pork export sales accelerated the slide in hogs, he said.
The U.S. Department of Agriculture (USDA) said a total of 60,499 tonnes of beef were sold for export in the week ended Nov. 12, more than three times the average weekly sales pace this year.
Pork sales were weaker than expected at 31,210 tonnes, the lowest in a month, according to USDA data.
In addition, lofty feed grain prices, with corn futures hovering near 16-month highs and soybeans at the highest in more than four years, weighed on feeder cattle and lean hog futures on Thursday.
Chicago Mercantile Exchange December live cattle fell 2.4 cents to 108.25 cents/lb., while actively traded February futures dropped 2.625 cents to 110.525 cents/lb. (all figures US$). January feeder cattle were 1.75 cents lower at 135.55 cents/lb.
December lean hogs fell 2.1 cents to 63.7 cents/lb. while actively traded February ended 2.85 cents lower at 63.05 cents/lb.
— Karl Plume reports on agriculture and ag commodities for Reuters from Chicago.