May 18, 2018 / 10:59 PM / 2 months ago

LIVESTOCK-Live cattle drop on weak cash prices, big supplies

    By Karl Plume
    CHICAGO, May 18 (Reuters) - Chicago Mercantile Exchange live
cattle futures         slumped for the fourth time in five
sessions on Friday as falling cash cattle prices and ample
supplies of slaughter-ready animals weighed on the market,
traders said.
    The possibility that meat exports could slow due to trade
tensions with China and uncertainty about a deal to revamp the
North American Free Trade Agreement (NAFTA) fueled concern about
an oversupply of meat in the U.S. market.
    Meanwhile, cattle traders have been anticipating an
oversupply of cattle this spring that would take prices down
from recent highs.
    "Traders are looking ahead at that big supply coming down
the pike," said independent livestock futures trader Dan
Norcini.
    "With all these trade issues, there's a lot of
second-guessing going on now whether demand is going to be
sufficient to eat through all this supply that's coming," he
said.
    CME June live cattle        ended down 0.650 cent at 102.400
cents per pound. Actively traded CME August live cattle futures
       shed 0.875 cent to settle at 98.225 cents per pound after
touching its lowest since April 4.
    Cash cattle at U.S. Plains feedlot markets traded this week
from $112 to $118 per cwt this week, well below last week's
sales of mostly $122 per cwt, traders said.
    Feeder cattle futures         fell in tandem with the live
cattle market. Sharply higher corn futures        added pressure
as rising feed costs chew into margins for feeders.
    The actively traded August contract        ended 1.100 cents
lower at 137.625 cents per pound.
    Lean hog futures         declined, pressured by concerns
about trade and higher feed costs.
    CME June hogs        fell 1.775 cents to 74.700 cents per
pound while July hogs        ended 0.950 cent lower at 77.250
cents.
    The U.S. Department of Agriculture is due to release its
monthly cold storage report on Tuesday at 2 p.m. CDT (1900 GMT)
which will include total beef and pork inventories for April. A
survey of analysts, on average, projected last month's total
beef stocks at 642.6 million pounds and 465.9 million for pork.

 (Reporting by Karl Plume
Editing by James Dalgleish)
  
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