By Kelsey Gee
CHICAGO--U.S. cattle futures ended little changed on Monday,
lifted by short-covering in some contracts after rising grain costs
and fears about demand sent futures to the lowest levels in a
year.
August live-cattle futures trimmed early gains to advance only
0.1 cent, or 0.1%, to $1.47675 a pound at the Chicago Mercantile
Exchange, after hitting the lowest price since June 2014 the
previous session. Live-cattle for October slipped 0.1 cent to
$1.49025 a pound.
Feeder-cattle futures for August climbed 1.125 cents to $2.16325
a pound, after picking up 1.9% last week.
The cattle market last week was closely tethered to activity in
corn futures, which, in turn, were jolted by changing forecasts for
rainfall during a key period of development for the U.S. crop.
Drier weather forecast Monday eased worries about the condition of
the crops, pushing futures lower, in turn propping up the
feeder-cattle market on Monday. If costs for the staple ingredient
in livestock feed decline, feedyard operators have more incentive
to bid up light-weight animals, which can also boost fat-cattle
prices.
At the same time, concern about the historically high costs for
beef sent cash prices lower last week, with most sales reported at
$1.48 a pound live, two to three cents below prices paid the week
before.
"Beef demand is caught in the summer doldrums with lots of high
temperatures curtailing grilling and abundant pork and poultry
supplies catching most of the retail featuring attention," wrote
Derrell Peel, livestock economist at Oklahoma State University, in
a research note.
Hog futures ended narrowly lower, pressured by continued heavy
supplies of market-ready animals and uncertain demand ahead.
Following the Fourth of July holiday-a key sales period for red
meat-consumers tend to buy fewer higher-value steaks, chops and
ribs during the hottest weeks of the year, typically opting for
lighter fare.
August hog futures fell 0.775 cent, or 1%, to 74.90 cents a
pound, the lowest close in nearly one-month, after that contract
climbed 2.7% last week. October futures shed 0.5 cent to 62.95
cents a pound
-Write to Kelsey Gee at kelsey.gee@wsj.com
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