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Cattle futures on the Chicago Mercantile Exchange ended Monday mixed, after mixed signals sent feeder cattle futures lower and live cattle contracts slightly higher.
Lean hog futures fell as market participants faced growing uncertainty in consumer meat demand as the U.S. enters the traditional summer grilling season.
In the CME lean pork market, June futures closed 0.775 cents lower at 98.175 cents per pound. Earlier in the session, the contract fell to 97.825 cents per pound, its lowest level since February 21.
CME June live cattle futures closed 0.300 cents higher at 176.975 cents per pound. August feeder cattle settled at 252.875 cents per pound, down 1.875 cents.
Values for U.S. Department of Agriculture prime and select beef cuts were up Monday morning – with prime cuts increasing. According to the USDA, values for pork cuts have also increased, particularly for loins, ribs and briskets.
Normally, that should signal to traders that consumer demand heading into the summer grilling season appears to be firm, analysts say.
While news of the cutouts helped drive down live cattle futures prices, warnings from publicly traded companies in the food, grocery and restaurant industries put Wall Street on notice that They were losing markets among low-income consumers.
“If consumers are finally feeling the effects of all this food inflation, that’s not good news for livestock,” said Dan Norcini, an independent livestock trader.
Livestock traders closely followed Tyson Foods’ third-quarter results on Monday, Mr. Norcini said. The company’s shares plunged after the U.S. meatpacking company warned that consumers were feeling pressure from persistent inflation and that high commodity costs could weigh on future results.
“This Tyson news did not bode well for pork futures, and the market reacted negatively,” Mr. Norcini said. (Reporting by PJ Huffstutter; Editing by Krishna Chandra Eluri)
