Chicago | Reuters –– Chicago Mercantile Exchange live cattle closed lower on Monday, pressured by profit-taking after three consecutive days of market advances, said traders.
Worries about burdensome supplies in the coming weeks further weighed on live cattle futures, they said.
“We’ve got a lot of cattle coming, but the market seems to be absorbing it,” said Oak Investment Group president Joe Ocrant.
Fund liquidation developed after June slipped below its 40-day moving average of 106.842 cents and August fell below its 10-day moving average of 104.615 cents (all figures US$).
April live cattle, which expired at noon CT, settled down 0.7 cent/lb. at 123.75 cents. June closed 0.9 cent lower at 106.1, and August ended 1.45 cents lower at 104.525 cents.
Bullish market investors expect a June futures rally soon based on higher packer profits and strong wholesale beef values fueled by spring grilling demand.
Market participants will keep close tabs on this week’s slaughter-ready, or cash, cattle prices that last week brought $118-$126.50 versus $119-$124 a week earlier.
CME feeder cattle fell on technical selling and lower cattle futures. May closed 1.85 cents/lb. lower at 140.175 cents.
Hogs gain modestly
CME hog futures rose slightly led by modest cash hog and wholesale pork price gains, said traders.
Future’s premiums to the exchange’s lean hog index for April 26 at 61.75 cents limited market advances, they said.
May closed up 0.2 cent, at 66.3 cents. Most actively traded June ended up 0.075 cent at 72.7 cents.
Some processors competed for hogs that are in short supply in parts of the Midwest as farmers focus on planting corn and soybeans, said traders and analysts.
Retailers are stocking up on meat to accommodate outdoor cook out advertisements, they said.
— Reporting for Reuters by Theopolis Waters in Chicago.