Chicago | Reuters—Chicago Mercantile Exchange (CME) live cattle futures eased on Monday on ample supplies of market-ready cattle and expectations for flat to lower cash cattle sales this week, traders and analysts said.
Concerns about beef demand also hung over the market, despite an uptick in wholesale boxed beef values on Monday, as prices have been on a longer term decline since late March.
“The trade does expect lower cash cattle prices. That is baked into futures. We’re just waiting for the market to see packers working on the backlog of cattle,” said Rich Nelson, chief strategist with Allendale Inc.
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Wholesale boxed beef prices lurched higher on Monday, breaking a string of recent declines, due to a beef processing slowdown in recent days and strong beef consumption over the Mother’s Day holiday weekend.
The choice boxed beef cutout value jumped by $4.38 on Monday to $298.95 per cwt after four straight days of declines, according to U.S. Department of Agriculture (USDA) data. Select cuts were up $3.01 at $287.18 per cwt after three days of declines.
Average beef packer margins, meanwhile, fell to an estimated $116.95 per head on Monday, down from $103.05 on Friday and $101.60 a week ago, according to livestock marketing advisory service HedgersEdge.com LLC.
Livestock traders will be monitoring beef demand heading into the upcoming Memorial Day holiday weekend, historically a strong demand period for beef for cookouts.
CME June live cattle futures LCM24 finished 0.575 cent lower at 175.575 cents per pound. August feeder cattle FCQ24 finished 0.450 cents higher at 251.350 cents per pound.
Lean hog futures ended the day mostly lower on weakening cash hog and pork prices.
CME June lean hogs LHM24 settled down 0.900 cent at 97.475 cents per pound.
