Live cattle futures retreat on profit-taking - CME

April lean hog futures pulled back
calendar icon 14 February 2022
clock icon 2 minute read

Chicago Mercantile Exchange (CME) live cattle futures weakened on Friday as the market retreated from contract highs hit this week, reported Reuters.

Profit-taking weighed on futures prices, though the market remains supported by strong demand for cattle from meatpackers, traders said.

Packers like Tyson Foods and JBS USA slaughtered an estimated 120,000 cattle on Friday, up 5.3% from a week ago and 12.1% from a year ago, the US Department of Agriculture (USDA) said.

"We've rallied here for a couple weeks now," a commodities broker said. "Really the strength comes from the increased slaughter pace."

April live cattle ended 0.700 cents lower at 146.175 cents per pound, after rising on Thursday to a contract high of 148.700 cents. March feeder cattle closed 0.500 cent lower at 166.225 cents per pound.

Beef processors' profit margins were $268.60 per head of cattle, compared to $298.45 per head on Thursday and $371.75 per head a week ago, said Denver-based livestock marketing advisory service HedgersEdge.com LLC.

"They're going to kill as many as they possibly can with those type of margins," the broker said.

Choice cuts of boxed beef fell by 30 cents to $274.52 per cwt, while select cuts dropped by $1.12 to $267.83 per cwt, the USDA said.

In the pork market, wholesale cutout values jumped, with the carcass value up by $8.48 per hundredweight, the USDA said.

Still, CME April lean hog futures pulled back to settle 1.200 cents lower at 102.225 cents per pound. The contract on Thursday set a contract high of 107.700.

In other livestock news, US poultry producers are tightening safety measures for their flocks as disease experts warn that wild birds are likely spreading a highly lethal form of avian influenza across the country.

Source: Reuters

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