Livestock futures ease on feed prices, profit-taking - CME

Markets are closed until Tuesday
calendar icon 2 January 2023
clock icon 2 minute read

Chicago Mercantile Exchange (CME) Group livestock futures eased back on Friday, as traders sought profits after cattle futures hit new contract highs in the previous session and on pressure from a run-up in grains, traders said.

US livestock markets will be closed on Monday for the New Year holiday. On Tuesday, the markets will pre-open at 8:00 a.m. CST (1400 GMT), with regular trading opening at 8:30 a.m. CST (1430 GMT).

For cattle futures, shrinking weights of market-ready cattle and concerns over smaller supplies continues to be a concern for the sector, said Don Roose, president of Iowa-based broker US Commodities.

But traders are anticipating a bull market going into 2023, said Roose, and have factored quite a bit of premium into prices.

"We've got a cyclical market, where you see 3-1/2 years of liquidation of the herd, and then you see the herd size start to expand," Roose said. "We're now four years into the liquidation phase and a lot of people think we've finally bottomed out. The question mark now is what is the demand going to look like next year?"

The US Department of Agriculture (USDA) on Friday reported net export sales of US beef in the week ended Dec. 22 at 2,300 tonnes for 2022 and net sales of 7,200 tonnes for 2023 - with Japan being the biggest buyer for both years.

Benchmark CME February live cattle fell 0.95 cent to 157.900 cents per pound. March feeder cattle futures eased 0.550 cents to settle at 186.225 cents per pound.

Cattle slaughter increased after a slower pace due to last week's winter storm, with 122,000 head processed on Friday, up from 104,000 head a week ago.

CME February lean hogs on Friday fell 0.975 cents to 87.700 cents per pound.

USDA reported net export sales of US pork for the week ended Dec. 22 at 15,100 tonnes for 2022 and net sales of 30,500 tonnes for 2023 - both primarily for Mexico.

Hog slaughter rose to 477,000 head on Thursday, up from 109,000 head slaughtered a week earlier.

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