CME: Futures Continue Sideways Trend as Traders Wait on Cash Signals, Tuesday31 July 2013
US - Live cattle futures traded slightly lower in quiet trade on Tuesday, finishing 15 to 45 cents lower in the August through June 2014 contracts with August leading the decline. Most contracts closed midrange.
August cattle closed down 45 cents to $121.65.
The cattle market continued its sideways trend as traders waited on direction from the cash market.
Traders continue to look for a seasonal low in cash cattle prices, but confirmation of that low is lacking, so far, write ProFarmer analysts.
October cattle closed 32 lower on the session and up 50 from the early lows, write market experts at CME.
The market traded higher on the day ahead of the pit opening but weakness in hogs and weakness in beef prices late Monday helped to spark speculative long liquidation selling with the market down sharply into the mid-session, say CME experts.
Traders continue to expect a seasonal rise in cash cattle and beef prices just ahead but beef prices have remained in a downtrend this week and traders see a higher showlist this week as compared with last week and this has brought about some concerns that cash cattle prices could remain sluggish short-term.
There are also some concerns that the stiff premium of futures to cash will cause feedlots to "feed out" cattle to higher weights in hopes of higher cash prices just ahead.
Boxed beef cutout values were down 74 cents Monday to $186.41.
This was down from $188.98 the prior week.
Choice beef was up 2 cents on the mid-day wire while select beef prices were down 44 cents.
Slaughter came in higher than trade expectations at 125,000 head.
TheCattleSite News Desk