LIVESTOCK-CME live cattle sink on fund liquidation, technical selling – Successful Farming

By Karl Plume

CHICAGO, April 30 (Reuters) – U.S. live cattle futures fell
on Tuesday, with the actively traded June contract down
for a seventh straight session, as fund long liquidation and
technical selling pressured the market.

Before the latest selloff in cattle began, commodity funds
had built a record large net long position, and open interest in
the market had reached the highest on record.

Rainy weather and unseasonably chilly temperatures around
large parts of the United States has, meanwhile, blunted demand
for outdoor grilling of beef and other proteins, while supplies
have remained abundant. Recent stressful weather in some feedlot
areas had raised concerns about large weight losses in cattle.

“There is no shortage of cattle out there and the weight
loss that everybody thought we would see has not materialized,”
said Jeff French, analyst with Top Third Ag Marketing.

“Right now the money flow is wanting to get out of their
positions and this selloff could just be beginning,” he said,
referring to managed commodity funds.

Chicago Mercantile Exchange (CME) June live cattle futures
settled down 0.550 cent at 114.250 cents per pound, the
contract’s lowest since Dec. 7. August live cattle ended
down 0.775 cent at 111.775 cents per pound.

Feeder cattle futures followed live cattle futures lower as
funds liquidated long positions and as corn prices edged upward
on worries about rain-delayed U.S. planting.

August feeder cattle fell 1.925 cents to settle at
149.150 cents, a near-three-month low. May feeders, which
expire next month, hit a contract low and settled down 1.800
cents at 141.600 cents.

Lean hog futures were mixed as traders consolidated
positions following a multi-session slide.

Funds have also been liquidating long holdings on hogs, but
the market has been supported at times by strong prospects for
exports to China.

The world’s largest hog and pork market has been culling
hogs to try to control a severe outbreak of African swine fever.
Losses from the disease, deadly for hogs but not humans, is
expected to bolster China’s pork imports this year.

But in what could pose a challenge to U.S. pork exporters,
China has approved Argentine pork for export.

CME June lean hogs ended up 0.175 cent at 88.225
cents per pound and July futures fell 0.175 cent to
92.375 cents.
(Reporting by Karl Plume
Editing by James Dalgleish)

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