CME: Futures Close Lower, Tuesday29 August 2013
US - Live cattle futures ended 10 to 45 cents lower on Tuesday with August live cattle closing at $122.95.
Analysts suggest that light pressure in the market is a sign that feedlots will have higher estimates than last week making steady cash prices hard to come by.
December cattle has given back about half of the gains from the bullish USDA on-feed report while October cattle has given back all of the gains with the weak close yesterday, write market analysts at CME.
The report showed a tightening supply for later this year but did not change the short-term supply outlook and demand concerns were enough to spark selling. A weak stock market, uncertainty over global economic political uncertainties in the Middle East plus volatile global currency markets are all factors which have sparked beef demand uncertainties.
In addition, sluggish beef prices this week and a hefty showlist has injected uncertainties over the short-term direction in the cash market.
With futures at a premium to the cash market, the sloppy near-term cash fundamentals and demand uncertainties sparked the long liquidation selling. Ideas that high temperatures could spark weight loss and lower production have been offset by fears that heat over the Labor Day weekend could hold down consumer demand.
Boxed-beef cut-out values at mid-session came in at $196.23, up 43 cents on the day and up from $195.60 last week at this time. Slaughter came in slightly above trade expectations at 124,000 head.
TheMeatSite News Desk