Chicago | Reuters – U.S. cattle futures retreated on Tuesday after hitting a near three-month high in the previous session as rising feed costs and a downturn in equities markets triggered selling.
Cattle futures have firmed in recent days as hopes for an economic stimulus deal in Washington overshadowed worries about restaurant closures and travel disruptions due to surging coronavirus infections.
Equities markets turned lower at midday as investors awaited U.S. Senate action on an enhanced stimulus package.
“The cattle want to follow the equities and when we saw a turn lower in the Dow and the S&P at midday, the longs just pulled the plug in the cattle market,” said Mike Zuzolo, president of Global Commodity Analytics.
Read Also
Alberta crop conditions improve: report
Varied precipitation and warm temperatures were generally beneficial for crop development across Alberta during the week ended July 8, according to the latest provincial crop report released July 11.
A corn futures surge, with price of the feed grain jumping 2.1% on Tuesday, also dragged down feeder cattle futures, which added pressure to live cattle contracts, he said.
Chicago Mercantile Exchange (CME) February live cattle futures fell 1.200 cents to settle at 114.575 cents per pound. CME March feeder cattle dropped 1.375 cents to close at 141.225 cents per pound.
Cash cattle at U.S. Plains feedlot markets are expected to trade at higher prices this week as packers will be buying animals for full slaughter weeks after the year-end holidays. A winter storm hitting the central Plains this week may also limit cattle movement in Nebraska and Iowa.
Lean hog futures firmed after two days of losses on short covering and technical buying.
The pork carcass cutout value edged up 51 cents on Tuesday to $72.36 per cwt, according to the U.S. Department of Agriculture.
CME February lean hogs ended 0.700 cent higher at 67.200 cents per pound after holding technical chart support at its 20-, 50- and 100-day moving averages.
