Chicago | Reuters — Chicago Mercantile Exchange live cattle futures eased for a fifth consecutive session on Wednesday, pressured by lagging slaughterhouse production, analysts said.
“We’re just not processing cattle fast enough. Some of the supply chain bottle necks that have affected the cattle market up to this point, they still remain in play,” said Altin Kalo, economist at Steiner Consulting Group.
CME February live cattle futures settled 0.575 cent lower at 137.25 cents/lb., while CME March feeder cattle futures lost 0.175 cent, to 166.175 cents/lb. (all figures US$).
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Packers processed 116,000 head of cattle, the U.S. Department of Agriculture said, down 4,000 head from a week ago and 2,000 fewer than the same day last year.
Sluggish processing speeds have kept cash cattle stagnant, with $140/cwt offered in the Northern plains markets, while Southern markets continue light trade at $138/cwt.
Meanwhile, boxed beef prices climbed, with select cuts adding 38 cents, to $259.61/cwt, while choice cuts gained 11 cents, to $266.93/cwt.
Lean hog futures also suffered from lighter slaughter, but lighter supplies of market-ready hogs helped lift cash prices and firm futures.
CME February hogs added 2.125 cents, to 82.275 cents/lb.
“Supplies on the ground are relatively tight,” said Kalo. “the cash price showed a pretty decent improvement.”
CME’s Lean Hog Index, a two-day weighted average of cash hog prices, firmed 90 cents, to $72.75/cwt.
Hog slaughter fell 4,000 head versus the same day last week to 470,000 head processed, lagging year-ago slaughter by 22,000 head, USDA said.
— Christopher Walljasper reports on agriculture and ag commodities for Reuters from Chicago.
