US cattle fall on rallying corn prices - CME
October lean hog futures end up
13 August 2024
2 minute read
By: Chicago Mercantile Exchange (CME) cattle futures turned lower on Monday as corn futures rallied following the US Department of Agriculture's (USDA) supply and demand report that lowered corn ending stocks, Reuters reported, citing traders.
Meanwhile, hog futures were mixed as bargain buying counterbalanced seasonal price pressure.
CME most-active October feeder cattle closed down 2.05 cents at 237.725 cents per pound. Most-active October live cattle finished 1.125 cents lower at 180.025 cents per pound.
Higher grain prices raise feeding costs for the animals.
"It's a knee-jerk response," independent trader Dan Norcini said. "When you see higher corn, you see lower feeder cattle prices."
Traders said weak feeder cattle prices also added pressure to live cattle futures.
Corn futures rose after the USDA lowered corn ending stocks despite increasing its harvest estimate from last month.
US 2024/25 corn end stocks were seen at 2.073 billion bushels, down from the agency's estimates in July of 2.097 billion bushels and lower than analyst expectations at 2.096 billion bushels.
In previous weeks, weakness in the Chicago corn futures market had lent support to cattle futures as corn is a key component of livestock feed.
Morning and afternoon boxed beef prices increased, according to USDA data, reflecting continued strong consumer demand for beef. Pork carcass cutouts also rose.
Traders have rolled positions out of the August live hog contract as the contract nears its expiration. CME October lean hog futures ended up 0.350 cent at 74.325 cents per pound.
A recent decline in hog prices due to a seasonally high supply of slaughter-ready pigs prompted bargain buying, which has supported prices, traders said.
