Live cattle futures have lost momentum after reaching summer highs, but the decline should not be confused with a sudden increase in the nation’s cattle supply. The recent weakness reflects softer cash trade, slower seasonal beef demand and technical selling. In the long term, the fundamental balance remains tight.
As of August 18, October live cattle futures were near $219 per hundredweight, down roughly $11 from the early-August high. Cash cattle also traded $2 to $3 lower during the second week of August. Packers had covered much of their near-term inventory, while beef demand entered the slower period between the Fourth of July and Labor Day. Those conditions reduced the need for packers to bid aggressively for market-ready cattle.
