Cattle Futures Slide as Cash Trades Weaken and Hog Prices Climb

CME cattle futures declined on Friday, as softening cash trades weighed on the market. Live cattle prices in northern cash markets fell to $220 per hundredweight (cwt), a $2 drop from the previous week. Meanwhile, southern markets saw higher prices at $225 per cwt, prompting some operators to transport cattle to Oklahoma and Texas for better sales.

Don Roose, president of Iowa-based US Commodities, noted that traders were seeking seasonal support in cattle futures, hoping for a boost from the corn market, which dipped to a six-week low. Slaughtering operations have been recovering from recent disruptions caused by an immigration crackdown affecting meatpacking plant workers. On Friday, meatpackers processed an estimated 100,000 cattle, up from 87,000 a week earlier, according to USDA data.

Profits for meatpackers dropped sharply to $69.35 per head of cattle on Friday, down from $126.45 the previous day and $70.45 a week ago. In contrast, hog futures rose, with CME December lean hog futures closing up 1.200 cents at 70.125 cents per pound. CME November feeders settled 5.200 cents lower at 331.150 cents per pound, while December live cattle finished down 1.700 cents at 221.475 cents per pound.

Wholesale prices for beef and pork were mixed. Choice cuts of boxed beef fell $2.43 to $374.36 per cwt, while select cuts rose $0.47 to $353.36 per cwt. The wholesale pork carcass cutout increased by 81 cents to $86.10 per cwt, with pork bellies rising $1.30 to $94.73 per cwt.