Chicago | Reuters — Chicago Mercantile Exchange live cattle futures ended lower despite finding new contract highs on Thursday, pressured by lower movement across the agricultural commodities late in the trading session, though tight cattle supplies underpin the market, traders said.
“Demand in general still is in good shape. You’re going to have incrementally fewer animals out there, so that’s going to continue to be supportive of the cattle complex,” said Altin Kalo, economist at Steiner Consulting Group.
April live cattle ended 0.95 cents lower at 146.875 cents/lb., after reaching 148.7 cents, its highest since September 10, 2015 (all figures US$). March feeder cattle closed 1.55 cents lower at 166.725 cents/lb.
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Pace of slaughter has remained strong all week, with packers slaughtering an estimated 123,000 cattle on Thursday, up from 117,000 cattle a week ago and 115,000 cattle a year ago, according to daily USDA data.
Stronger processing demand has pulled market-ready cattle forward, with negotiated cash cattle trade steady-to-firmer from Nebraska to Texas, the U.S. Department of Agriculture said, with live purchases trading steady to $2 higher versus last week at $140 per hundredweight.
Boxed beef prices seem to be leveling off, Kalo said, though they remain elevated.
Choice cuts of boxed beef fell by 97 cents, to $274.82/cwt, while select cuts dropped by $3.10, to $268.95/cwt, USDA said.
Hog futures also stepped back after trading higher much of the day, supported by fewer-than-expected hogs and strong demand for pork as the price of beef and chicken remains elevated, Kalo said.
CME April lean hogs settled 1.35 cents lower at 103.425 cents/lb., after setting a contract high of 107.7. Thinly traded February hogs slipped 0.05 cent to end at 90.175 cents/lb.
Processors slaughtered an estimated 473,000 hogs, compared to 416,000 hogs a week ago and 486,000 hogs a year ago, the USDA said.
The CME’s lean-hog index, a two-day weighted average of hog sales, added 60 cents to 87.22 per pound.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.
