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CME update: Live cattle futures fall amid larger Wall Street drop

30 December 2020

US cattle futures retreated on 29 December after hitting a near three-month high in the previous session as rising feed costs and a downturn in equities markets triggered selling.

Reuters reports that 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 US 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.

A corn futures surge, with price of the feed grain jumping 2.1 percent 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 US 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.

Read more about this story here.

Source: Reuters



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