Chicago Mercantile Exchange (CME) live cattle futures backpedaled on Thursday after climbing to contract highs during the previous session, while hog futures jumped, reported Reuters.
Traders projected the cattle market's setback would be short lived as futures remain too low compared to cash prices.
Futures and cash prices have set records this year as U.S. cattle inventories have dwindled to their lowest levels in decades. Meatpackers, such as Tyson Foods, increasingly must compete to buy limited supplies of cattle from farmers to process into beef.
CME August live cattle futures finished down 0.225 cent at 223.675 cents per pound after setting a contract high of 224.400 cents on Wednesday.
CME August feeder cattle futures closed 0.575 cent lower at 325 cents per pound.
"Every time we see breaks, the market finds support," a broker said. "Futures are way too low versus the cash."
Strong cash prices for cattle and declining beef prices have squeezed meatpackers' profits. They were losing an estimated $174.35 per head of cattle they slaughtered on Thursday, according to HedgersEdge.com.
Light trading of cattle in the cash market this week has been largely steady from last week, when prices climbed, traders said.
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