Cattle futures plumb new lows on technical selloff, hogs firm
U.S. cattle futures tumbled 2 percent on Thursday, extending losses to six-year lows on pressure from technical selling and weak prices in cash cattle markets, traders said.
Lean hog futures added to recent gains at the Chicago Mercantile Exchange, boosted by technical buying and as investors exited short positions following hog's seven-year lows reached last week.
Supplies of U.S. beef and pork were plentiful, and many traders had bearish outlooks for cattle and hog futures, absent a significant spike in export sales to Asia. The U.S. Department of Agriculture will release weekly U.S. beef and pork export sales early on Friday.
Front-month CME October live cattle futures fell to 94.300 cents per lb, the lowest price on a continuous chart since Aug. 16, 2010. Most-active December live cattle futures
settled down 1.825 cents at 96.175 cents per lb, in the fourth straight session of declines.
"Technical selling was the big feature today, and just a lack of any interest in buying," said Zaner Group analyst Ted Seifried.
Feeder cattle futures declined to the lowest levels since December 2010, with the most-active November contract finishing 2.950 cents lower at 114.825 cents per lb.
Steep gains in corn futures also weighed on feeder cattle as higher animal feed prices raise costs for fattening cattle, potentially reducing demand.
CME December lean hog futures were up 0.125 cent to 44.175 cents, rising to a roughly one-week high and gaining for the second straight day.
USDA data released after the close of trading showed slightly higher wholesale beef prices and lower pork prices.
Slaughter-weight cattle traded lightly at $98 per cwt in Texas, down from $101 to $102 a week ago, feedlot sources said.
Meat and animal prices have trended lower for weeks as consumer demand for outdoor grilling slowed seasonally while retailer purchasing also likely slowed in southern U.S. states such as North Carolina and Florida because of Hurricane Matthew.
