Chicago Mercantile Exchange (CME) live cattle futures experienced a rebound on Monday following a sluggish performance last week, while feeder cattle futures declined as corn prices surged on the Chicago Board of Trade (CBOT).
The October live cattle futures (LCV24) closed up 0.725 cents at 179.025 cents per pound. In contrast, the October feeder cattle futures (FCV24) ended 0.075 cents lower at 235.875 cents per pound.
The recovery in live cattle futures was driven by short covering after a decline on Thursday and Friday, according to independent livestock trader Dan Norcini. Analysts noted that this rebound was mainly a correction from the previous oversold conditions.
Feeder cattle futures were negatively impacted by a rise in corn prices, which bounced back from multiyear lows the previous week. Increased grain prices lead to higher feeding costs for livestock.
Traders also observed the effects of dry weather on corn and monitored updates from the Pro Farmer crop tour, which began traveling through the Midwest on Monday.
CBOT September corn futures (CU24) settled up 7.5 cents at $3.78 per bushel, while December corn futures (CZ24) rose 7.75 cents to $4.00-1/4 per bushel.
The approaching Labor Day holiday on September 2, a key period for beef consumption, also influenced the market. Analysts noted that many traders are cautious about buying cattle aggressively and will be watching for Labor Day demand.
Norciini expressed concerns that current beef demand may not sustain due to economic conditions, adding to market uncertainties.
Additionally, CME October lean hog futures (LHV24) closed down 1.725 cents at 76.800 cents per pound.
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