Chicago Mercantile Exchange (CME) cattle futures turned lower on Tuesday, as a lack of fundamental news and limited trading in the cash cattle market had price drifting down from the recent rally, Reuters reported, citing traders.
Meanwhile, CME lean hog futures in the nearby and front contracts ended down as funds continued to short the market as a glut of slaughter-ready hogs continued to outweigh the levels of consumer demand, market analysts said.
Wholesale prices for US pork have generally turned lower or remained relatively flat, traders said.
The US Department of Agriculture (USDA) on Tuesday morning priced the pork carcass cutout at $98.98 per hundredweight (cwt), up 4 cents from Monday. Though pork belly prices firmed, loin prices continued to fall, USDA data shows.
Consumer frustration over stubbornly high food prices, and ongoing uncertainty when interest rates might ease have been weighing on the pork market for a while, analysts said.
New York Federal Reserve President John Williams said on Tuesday interest rates will come down gradually over time, but he declined to say when the US central bank can kick off its monetary policy easing.
"It's like what you're seeing happen in the fast food industry," said Dan Norcini, an independent livestock trader. "If people are having trouble paying for a hamburger or cheeseburger, they're certainly not going to pay up to put bacon on it."
On Tuesday afternoon, wholesale boxed beef prices ticked slightly higher for choice cuts and fell for select cuts, according to USDA data.
But analysts cautioned that retail demand could ease later week, as a severe heat wave has roughly 80 million people from Indiana to New England sweltering under a heat advisory or excessive heat warning.
CME July hogs closed 1.600 cents lower at 93.775 cents per pound.
CME August live cattle settled 0.700 cent lower at 182.100 cents per pound. CME August feeder cattle ended down 1.375 cents to end at 259.950 cents per pound.
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