February lean hog futures settle up - CME
Cattle futures dip on profit-taking
19 December 2024
2 minute read
Chicago Mercantile Exchange (CME) cattle contracts slid on Wednesday as profit-taking, a stronger dollar and a selloff across agricultural commodities weighed on futures, Reuters reported, citing analysts.
Lean hog futures rose slightly on support from strong demand and stable pork cutout values.
CME January feeder cattle settled down 0.475 cent to 257.000 cents per pound. February live cattle ended down 1.425 cents to 188.325 cents per pound. February lean hog futures settled up 0.500 cents to 83.700 cents per pound.
“The dollar going higher at the end of the session and the broad ag liquidation weighed on things and encouraged profit taking in the absence of big, fresh news or a strong cash trade,” Matthew Wiegand, broker at FuturesOne, said.
The U.S. dollar, already strong to begin the day, shot to a two-year high after the U.S. Federal Reserve delivered a rate cut. A stronger dollar typically makes U.S. exports less competitive.
Widespread weakness in soybean, corn and wheat futures also pressured cattle futures.
“When it’s a big liquidation, you tend to see things move in tandem,” Wiegand said.
The U.S.-Mexico border remains closed to cattle imports after the discovery of New World screwworm in southern Mexico, further restricting an already-tight U.S. cattle supply and adding a floor to futures, traders said.
Though the U.S. Department of Agriculture (USDA) has signaled the border will reopen for imports in the New Year, traders say tight safety protocols will mean a slow flow of imports.
A Reuters poll released ahead of the USDA’s monthly Cattle on Feed report showed analysts expect U.S. November cattle placements to be 5.1% lower than last year.
The USDA’s report will be released on Friday at 2000 GMT (2 p.m. CST).
