Cattle futures gain on shutdown of Mexican cattle - CME
Lean hog futures advanced for a fifth day
27 November 2024
2 minute read
By: Chicago Mercantile Exchange (CME) live and feeder cattle futures were steady to higher on Tuesday owing to strong beef demand and the detection of screwworm in a cow in southern Mexico, which has temporarily shut down exports of Mexican cattle to the US, reported Reuters.
Analysts and brokers said the border will be shut for multiple weeks, constraining supply at a time when beef demand has proved resilient.
"Cattle supplies are going to get pretty tight going forward," Altin Kalo, economist at Steiner Group, said.
CME January feeder cattle settled up 2.625 cents at 258.100 cents per pound. February live cattle futures were unchanged at 187.70 cents per pound.
Wholesale choice boxed beef gained $1.86 to $311.57 per hundredweight on Tuesday, according to the US Department of Agriculture. Select boxed beef gained $1.75 to $275.49 per cwt.
President-elect Donald Trump on Monday said he would sign an executive order on his first day in office that would impose a 25% tariff on all products coming into the United States from Canada and Mexico.
Trump's plan could slow the movement of more than 1 million cows exported by Mexico across the border each year, to become part of the US beef supply.
Producers could benefit if tariffs lead to fewer cattle and beef imports, but tariffs could also further increase meat prices for US consumers.
Market reaction to the tariff threats was subdued on Tuesday.
"There's quite a bit of unknown on tariffs, and until there's more clarity on whether they'll go in place and when, the market's not trading them," Kalo said.
CME lean hog futures advanced for a fifth day on Tuesday, supported by steady demand and a lower-than-expected number of slaughter-ready hogs.
Most-active February futures settled up 2.350 cents at 88.275 cents per pound, and the wholesale pork cutout fell $2.18 to $91.15 per cwt.
