Live cattle, feeder cattle futures close lower - CME
Lean hogs hit contract lows
21 March 2023
2 minute read
By: Chicago Mercantile Exchange (CME) lean hog futures dropped on Monday, with nearby futures at contract lows as macroeconomic worries and a lower wholesale pork prices raised uncertainty about meat demand and sparked a round of technical selling, Reuters reported, citing traders.
Live cattle and feeder cattle futures also closed lower.
"The big weight over the livestock markets is trader concerns for demand moving forward. And the demand concerns are tied to the state of the economy," said Dan Norcini, an independent livestock trader.
Front-month April lean hogs settled down 2.100 cents at 77.775 cents per pound after hitting a contract low at 77.425 cents. Thinly traded May also hit a contract low while June hogs closed down 1.450 cents at 91.875 cents per pound.
Wholesale pork values steadied on Monday after a steep, four-day decline last week. The US Department of Agriculture (USDA) priced pork carcasses at $81.64 per hundredweight (cwt), up 69 cents from Friday's one-month low of $80.95. Hams rose by $2.28 to $73.19 per cwt, calming fears that weakness in Mexico's peso versus the US dollar was hurting Mexican demand for ham.
Cattle futures declined as traders continued to watch Wall Street and outside markets to gauge the health of the economy.
CME April live cattle settled 0.300 cent lower at 162.025 cents per pound. April feeder cattle finished down 0.025 cent at 194.625 cents per pound.
In the wholesale beef market, the USDA priced choice cuts of beef at $281.02 per cwt, down $2.33 from Friday, while select cuts rose $1.50 to $273.94 per cwt.
"The spread between the choice and select narrowed. Usually when you see that, people are shying away from the pricy cuts of beef and buying the cheaper cuts," Norcini said.
Worries about beef demand overshadowed early support from Friday's monthly USDA Cattle on Feed report. The government said the number of US cattle on feed, as of March 1, was down 4.5% from a year earlier, in line with analysts' expectations, while February placements of cattle into feedlots were down 7.2%, compared with expectations for a 6% drop.
