Livestock Futures End Week With Losses
August 18 2017 - 3:37PM
Dow Jones News
By Benjamin Parkin
Cattle futures fell for the third consecutive day as lower red
meat prices pressured the market.
Most-active live cattle futures for October delivery fell 0.3%
to $1.059 a pound on Friday at the Chicago Mercantile Exchange.
Wholesale beef prices have traded below $2 a pound for the first
time in months as of late last week. A pound of beef fell 1.88
cents to $1.9563 a pound on Thursday, and slid further as of midday
Friday.
The falling cost of beef has had a ripple effect on the broader
market, cutting into packer margins, which in turn has lowered
cash-market prices and weighed down futures.
Packer margins for the week were at $63 a head, according to the
HedgersEdge index. That was the lowest since mid-May.
Meatpackers, in turn, lowered their bids for cattle in the
week's cash trade with feedlots. They bought a little over 70,000
cattle on Thursday for an average of $1.10 a pound live and $1.75 a
pound dressed. That was mostly 5 cents a pound below last week on a
live basis, cutting into feedlot's profitability.
Hog futures, meanwhile, also fell. CME October lean hog futures
dropped 1.2% to 66.125 cents a pound, trading at a three-month
low.
Analysts say hog futures are under pressure after losing
technical support. The correction started with a sharp drop in pork
belly prices earlier this week.
A pound of pork belly meat fell to $1.8141 on Thursday. That
prompted selling at the opening on Friday, though meat prices had
turned higher as of midday.
An agreement between American and Argentine officials to re-open
the South American country to U.S. exports after over two decades,
announced by the White House on Thursday, had limited impact on
prices.
Write to Benjamin Parkin at benjamin.parkin@wsj.com
(END) Dow Jones Newswires
August 18, 2017 15:22 ET (19:22 GMT)
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