Chicago | Reuters — U.S. live cattle futures closed lower on Tuesday on profit-taking after rising to the highest levels in nearly eight years, with worries about the health of the U.S. economy adding to bearish sentiment, analysts said.
Benchmark April live cattle futures on the Chicago Mercantile Exchange settled down 0.425 cent at 164.675 cents/lb. (all figures US$). Front-month February finished down 0.125 cent at 162.15 cents/lb., retreating after climbing to 162.35 cents, the highest on a continuous chart of the spot futures contract since April 2015.
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CME March feeder cattle futures ended down 0.55 cent at 186.65 cents/lb.
“It’s just a little profit-taking. We broke out of the top of a trading channel, and then didn’t have any follow-through,” said Doug Houghton, analyst with Brock Capital Management.
Macroeconomic jitters hung over the markets. Wall Street equities ended mixed after data showed U.S. consumer prices accelerated in January, suggesting that the Fed will maintain its fight against inflation.
But wholesale beef prices firmed, with choice cuts up $2.11 for the day at $272.06 per hundredweight (cwt). Select cuts were up $2.57 at $258.78, the U.S. Department of Agriculture said.
CME hog futures closed higher as cash hog prices firmed, a sign of tightening supplies. CME April hogs settled up 0.9 cent at 87.25 cents/lb., and June hogs rose 0.575 cents to end at 104.825 cents.
The CME lean hog index, a two-day weighted average of cash hog prices, rose by 63 cents to $74.64.
“A seasonal decrease in hog supplies seems to have begun, and that is accompanied normally by an increase in prices,” Houghton said.
USDA priced pork carcasses at $81.88/cwt Tuesday afternoon, up 14 cents from Monday.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago.
