Reuters — Most Chicago Mercantile Exchange live cattle and feeder cattle futures contracts fell their respective daily limits on Friday, as efforts by the U.S. to lower historically high beef prices appeared to spark a round of long liquidation by speculators, analysts said.
CME benchmark December live cattle futures were down their daily maximum of 7.250 cents at 233.925 cents per pound. CME November feeder cattle were down their limit of 9.250 cents, at 352.200 cents per pound.
Both markets had tumbled last week and again on Wednesday after U.S. President Donald Trump sought to reduce beef prices.
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The Trump administration said on Thursday that it would quadruple the country’s low-tariff imports of Argentine beef.
Traders also noted that Mexico’s agriculture minister will travel to Washington next week with the aim of reaching an agreement on the reopening of the border to Mexican cattle amid an outbreak of the flesh-eating screwworm parasite. The U.S. border has been closed to Mexican cattle imports since May.
“Managed money has a huge net long in the cattle market and has for a while,” said Austin Schroeder, commodity analyst for Brugler Marketing & Management.
“With all the headlines that we’ve got over the last week and a half, I would assume there is just some general risk-off (trade) heading into the weekend. Everybody is wanting out, and the door is only so big,” Schroeder said.
Live hog futures were narrowly mixed, with the December contract up 1.250 cents at 81.900 cents per pound.
— Reporting by Julie Ingwersen
