Beef futures fall as oil surge sparks demand fears - CME
Strong hog prices hold firm amid China export boost
16 June 2025
2 minute read
By: Benchmark live cattle futures on the Chicago Mercantile Exchange (CME) tumbled 2.1% on Friday as rising crude oil prices and geopolitical instability raised worries about consumer demand for meat, prompting speculators to take profits after the market soared to all-time highs this week, Reuters reported, citing analysts.
Most-active August live cattle futures settled down 4.500 cents at 212.450 cents per pound. The thinly traded June contract ended down 3.100 cents at 225.100 cents per pound, a day after reaching 229.125 cents, the highest-ever reading on a continuous chart of the front contract.
CME August feeder cattle futures closed Friday down 4.825 cents at 306.425 cents per pound.
Firm cash cattle markets, tight US cattle supplies and historically high wholesale beef prices propelled cattle futures higher this week.
But Friday's 7% jump in crude oil CLc1 futures, after Israel launched military strikes on Iran, appeared to trigger a round of profit-taking. Commodity funds hold hefty net long positions in CME live cattle and lean hog futures, leaving both markets prone to bouts of long liquidation.
"High crude oil prices are not necessarily good for meat demand... and the long side of the market has been loaded up," said Doug Houghton, an analyst at Brock Associates.
The US Department of Agriculture priced choice cuts of beef on Friday afternoon at $377.88 per hundredweight, up $1.16 from Thursday, and select cuts rose 43 cents to $363.50 per cwt. Both readings were the highest in five years. Beef demand typically reaches a seasonal top around the Father's Day and Fourth of July holidays, analysts said.
CME hog futures ended mixed, holding near life-of-contract highs set this week as robust cash hog markets and wholesale pork prices continued to underpin the market.
July lean hogs settled up 0.575 cent at 109.475 cents per pound while August hogs finished down 0.050 cent at 110.125 cents.
The USDA priced pork carcasses on Friday afternoon at $118.06 per cwt, up $3.56 from Thursday.
Meanwhile, China approved 106 new US pork and poultry plants to export eligible products produced on or after June 12, Chinese Customs said in a notice on its website. Hundreds of US meat plants gained access to China under the 2020 "Phase 1" trade deal brokered by President Donald Trump, but many lost their eligibility earlier this year.
