Chicago Mercantile Exchange live cattle futures tumbled 2 percent or more on Monday, with the front-month June contract falling by its 3.000 cents per pound daily limit in a technical selloff, traders said.
Sufficient cattle supplies and weaker trades last week in U.S. Plains cash steer markets also weighed on futures.
The most-active August contract settled 2.525 cents lower at 101.900 cents per pound, its lowest since April 20. June cattle finished at 104.625 cents, notching its biggest percentage decline since March 29.
Beef packers bought relatively large amounts of cattle late last week, giving some traders the impression that buyers would be less aggressive this week, analyst David Hales said in his daily Hales Cattle Letter.
Wholesale beef prices continued to climb, boosting profit margins for packers who could pay less for cattle and sell their beef at higher prices. Choice-grade wholesale beef rose $1.15 to $232.12 per cwt, highest in about 10 months, according to the U.S. Department of Agriculture.
CME August feeder cattle settled 3.525 cents lower at 140.375 cents per pound, tracking losses in the more actively traded live cattle futures.
Lean hog futures were higher, recovering from declines on Friday. June hogs were up 1.050 cents at 76.150 cents per pound and July hogs were 1.750 cents higher at 78.725 cents.
Hog prices often increase seasonally ahead of the summer as pork prices also rise and animal weights typically decline, limiting available supplies, according to Steiner Consulting Group analyst Altin Kalo.
"In May, prices tend to move higher," Kalo said.
Hogs in the key cash market of Iowa and southern Minnesota were up 76 cents to an average of $63.22 per cwt and wholesale pork was up 8 cents to $73.55 per cwt, USDA said.