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Cattle futures tumble on concerns over lower US demand - CME

14 June 2022

US hog futures climb slightly

Concerns about red-hot US inflation knocked down Chicago Mercantile Exchange (CME) live cattle and feeder cattle futures on Monday, as rising prices threaten beef demand, reported Reuters, citing analysts.

Demand is most at risk for expensive steaks and other pricey cuts as some consumers shift to buying cheaper items, analysts said.

US consumer prices accelerated in May as the cost of food soared, leading to the largest annual increase in nearly 40-1/2 years. 

CME June live cattle ended down 2.2 cents at 134.000 cents on Monday. The most-active August contact tumbled 2.325 cents to close at 133.875 cents and hit its lowest price since 1 June. The contract has backpedaled since jumping on Thursday to its highest price since 27 April at 137.950 cents.

CME August feeder cattle sank 3.150 cents to finish at 171.325 cents per pound and touched its lowest price since 2 June.

The cattle markets came under spillover pressure from sell-offs in global stocks as US inflation fuelled worries about even more aggressive policy tightening, brokers said.

Traders also digested reports of extreme heat stressing and killing some cattle in feedlots in Kansas.

"On the Plains, scorching heat has spread northward, following a blazing-hot weekend in Texas and environs," the US Department of Agriculture said in a daily weather report.

In other news, July lean hog futures rose 1.2 cents to end at 106.675 cents per pound. The contract recovered after falling earlier to its lowest price since 16 May.

Source: Reuters



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