CME live and feeder cattle futures experienced a decline on August 30, 2024, primarily due to a drop in boxed beef prices just ahead of the US Labor Day holiday. Select boxed beef prices fell by $1.09 to $296.54 per hundredweight, while choice cuts saw a slight increase of 0.94 cents to $308.23 per cwt. This follows a significant decline in prices earlier in the week, with choice cuts dropping by $4.68 and select cuts by $2.62. Analyst Austin Schroeder noted that retail buying has slowed, contributing to the price drop. Consequently, October live cattle closed down 0.725 cents at 177.9 cents per pound, and October feeder cattle finished down 1.9 cents at 236.675 cents per pound. Despite the US Commerce Department reporting positive economic growth, traders remain cautious, factoring in potential recession risks. Cash cattle market prices also remained steady to lower due to weak buying interest. [3a9829cf]
In contrast, October lean hog futures rose slightly by 0.5 cents to 82.225 cents per pound, benefiting from higher Chinese hog prices and a weaker dollar, which enhances the competitiveness of US pork exports. The seasonal drop in pork prices has been less drastic than last year, indicating some resilience in the market. This comes amid a reported 4% decrease in US frozen pork supplies year-over-year, with frozen pork belly stocks falling 17%. [1b37082d]
Earlier in the week, Chicago soybean and grain futures on the Chicago Board of Trade (CBOT) saw an upward trend as market participants rushed to cover short positions. The most-active CBOT soybean contract settled up 10-3/4 cents at $10.27-1/4 per bushel, while corn ended up 4-3/4 cents at $4.03-1/4 per bushel. Wheat prices also increased, settling up 7 cents at $5.39 per bushel, driven by concerns over adverse weather conditions in Europe and China affecting production. [9c1bee51]
CME cattle futures had previously experienced volatility due to a weakening US economy, prompting market participants to unwind long positions. The US Labor Department reported a jump in the unemployment rate to a near three-year high in July, raising fears of a recession. This led to a sell-off in global equities and a drop in the US dollar. [0a1b1e20]
Despite these challenges, CME cattle futures showed some stability on August 26, 2024, with October feeder cattle finishing at 234.375 cents per pound and October live cattle closing at 175.700 cents per pound. Low corn prices have provided a cushion for feedlots against market volatility, according to Don Roose of US Commodities. [9005a98c]