Cattle futures fell to a low for the year on Wednesday after packers dropped bids at a closely watched online auction.
Feedyards in Nebraska and Kansas sold 429 cattle out of a total 2,093 in the morning Fed Cattle Exchange online auction. Prices ranged from $1.1725 to $1.1775 a pound depending on the delivery date, down from around $1.20 the week before.
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"The cash cattle market was disappointing," said Coby Tresner, an independent livestock futures trader in Scottsdale, Ariz. "It didn't feel like the packer was interested in buying cattle."
Some analysts said tighter show lists of available cattle from feedyards this week could stem hemorrhaging in the cash market. Prices at the auction and elsewhere in the cash trade have fallen from as much as $1.39 a pound around a month ago, with supplies of market-ready cattle growing and demand for beef easing going into the summer despite a July Fourth grilling boost.
Live cattle futures for August delivery fell 1.9% to $1.1355 a pound at the Chicago Mercantile Exchange, the lowest close since Dec. 21.
August-dated contracts for CME feeder cattle, younger animals that need to be fattened before slaughter, fell 2.7% to $1.42225 a pound. A recent rally in corn prices, a key component of cattle feed, has cut into feedyards' margins.
Hog futures were higher as traders tried to close the gap between later month contracts and the cash market. The CME lean hog cash index was at 91.71 cents a pound on Wednesday, while the most actively traded August futures contract rose 0.2% to 84.575 cents a pound.
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(END) Dow Jones Newswires
July 05, 2017 15:58 ET (19:58 GMT)