CME update: US feeder cattle futures face pressure from grains complex

US feeder cattle futures dropped on 31 March, reacting to limit-up gains in corn and soybean futures that will translate to higher livestock feed costs as grain users compete for tight supplies.
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Reuters reports that most-active May feeder cattle futures finished 2.800 cents lower at 149.900 cents.

"Corn was limit up. Cattle were up a little bit, but not enough to allow you to pay that much for the feeders, so they took it out of the feeders," said Alan Brugler, president of Brugler Marketing.

Gains in live cattle were driven by consumer demand for beef, as boxed beef prices climb and cash trade strengthens.

Benchmark CME June live cattle futures ended 0.675 cent higher at 122.900 cents per pound, gaining seven of the last eight sessions.

Market-ready cattle traded in the Plains cash markets last week at around $115-$116 per cwt, up $1 from the previous week, and reached $118 this week, traders said.

Choice cuts of boxed beef were up $2.29 at $247.12 per cwt, according to the USDA. Select cuts added $2.21 to $238.13 per cwt.

Daily cattle slaughter fluctuated, as 119,000 head were processed Wednesday, down 3,000 from the same day a week ago, the USDA said.

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Source: Reuters

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