Chicago | Reuters — CME live cattle ended lower Friday as fund selling and weak cash cattle prices weighed, traders said.
Lower U.S. stocks and weak crude oil also pressured the overall livestock futures market, said Lane Broadbent of KIS Futures.
“We are in a tough time of the year as far as beef demand goes. And when there is a stock market sell-off, its takes even more demand away,” Broadbent said.
Market-ready (cash) cattle, sold in the U.S. Plains at $164 per hundredweight (cwt) compared with $166 to $168 last week (all figures US$).
As beef packer margins remain deeply in red and wholesale beef demand wanes packers were not aggressive buyers in the cash market which pushed prices lower this week.
Beef packer margins for Friday were a negative $115.55 per head, compared with a negative $103.70 on Thursday and a negative $132 last week, according to Colorado-based analytics firm Hedgersedge.com.
Friday morning’s choice wholesale beef price fell $2.16/cwt from Thursday to $245.63, and falling $6.75 since Monday, the U.S. government data showed.
December live cattle closed down 0.35 cent per pound at 162.05 cents, and February down 0.4 cent at 162.175 cents.
CME feeder cattle futures closed their three-cents/lb. maximum daily price limit for the second consecutive day as weak deferred-month live cattle futures weighed, traders said.
“The feeder market was so high for the last 10-12 months, now we have a sell-off,” Broadbent said.
January feeder cattle and March closed at 225.6 cents and 221.25 cents, respectively.
Weak pork demand hurts hogs
CME lean hogs closed lower on weak cash market prices and soft wholesale pork demand, traders said.
Early Friday, U.S. Midwest cash hogs traded 50 cents to $1/cwt lower, according to hog dealers.
Many pork processors have hog supply secured though the end of 2014 which kept buyers out of the market. Also, packing plants need fewer hogs due to holiday closures.
USDA data showed Friday’s wholesale pork price edged up $1.13/cwt from Thursday to $92.06, but was down $1.25/cwt for the week.
CME December lean hogs ended down 0.025 cent/lb. to 87.525 cents. December lean hog’s contract last trade was on Friday, which made the February contract the lead month.
February ended down 1.1 cent, to 83.25 cents, and April ended down 1.35 cent at 84.35 cents.
— Meredith Davis reports on ag commodity markets for Reuters from Chicago.