Economic - Markets
CME update: live cattle futures close lower as supply backlog weighs on industry
Reuters reports that the USDA report shows that the sector has yet to address the cattle backlog caused by shutdowns of processing plants due to the COVID-19 pandemic.
At the end of trading, August live cattle settled down 0.275 cent at 95.125 cents per pound.
Feeder cattle futures followed live cattle down, with August feeders down 0.800 cent at $131.750 cents per pound.
The current cattle backlog was outlined in a USDA cold storage report. The report shows total beef supplies in cold storage on 31 May at 415.2 million pounds. This is down 13 percent from a month earlier and up 2 percent from 2019. Inventories sank by 64 million pounds from 30 April, a period in which they usually fall by 19 million pounds, according to Allendale.
Livestock futures are also facing pressure from newly enacted Chinese food import restrictions. China's customs authority has also asked suppliers of imported food to sign a declaration their produce is not contaminated by the novel coronavirus.
