U.S. live cattle futures fell more than 1 percent on Tuesday, reversing from earlier life-of-contract highs on pressure from investment fund and technical selling, traders and analysts said.
Feeder cattle futures declined by their daily price limit of 4.500 cents per pound while lean hog futures were mostly 1 percent higher.
Cattle prices were buoyed in recent weeks by rising wholesale beef prices and lower cattle weights – factors that suggested strong demand. But beef prices typically trend lower in the early summer months as retailer buying slows.
Uncertainty surrounding top global beef processor JBS also triggered profit-taking in cattle futures, the traders said.
Chicago Mercantile Exchange June live cattle fell 1.900 cents to 130.200 cents per pound. Most-active CME August live cattle were down 2.600 cents to 123.600 cents per pound, after touching a contract high of 127.650 cents.
CME August feeder cattle declined 2.7 percent to finish at 155.375 cents per pound, reversing at midday amid heavy selling.
JBS Sells South American Beef Plants
JBS SA announced a sale of its meat plants in Argentina, Paraguay and Uruguay to rival Minerva SA amid a scandal in which JBS admitted to paying politicians bribes.
JBS has beef plants in Texas, Nebraska, Michigan and Wisconsin.
Source: Reuters (via Drovers)