CHICAGO, June 18 (Reuters) - Chicago Mercantile Exchange live cattle futures closed mixed on Tuesday, with expectations for a weak cash trade pressuring the benchmark August contract while back months ended firm, traders said.
Packers were not bidding aggressively for cattle, a factor that some traders took as a bearish signal.
“The bids that were out there were lowball. If (packers) were short-bought, it’s not showing,” said Doug Houghton, an analyst with Brock Associates Inc.
Cash beef values were soft. The U.S. Department of Agriculture (USDA) quoted choice boxed beef cutout on Tuesday at $220.53 per cwt, down $1.29 from Monday, while select cutout fell $0.71 to $201.80.
CME most-active August live cattle settled down 0.075 cent at 105.550 cents per pound.
However, October live cattle rose 0.350 cent to close at 107.050 cents, and CME August feeder cattle ended up 0.325 cent at 137.250 cents per pound.
Feeder cattle and deferred live cattle futures drew support from a setback in corn prices. Chicago Board of Trade corn futures have surged in recent weeks, hitting a five-year high on Monday that signaled higher feed costs for cattle producers.
But the yellow grain’s rally finally paused on Tuesday as planting wound down and traders booked profits.
Cattle futures also found strength from expectations that the monthly Cattle on Feed report due Friday from the U.S. Department of Agriculture will show a year-on-year reduction in the number of U.S. cattle placed on feed in May.
Lean hog futures closed mostly lower with July down 1.575 cents at 81.475 cents per pound and August down 0.550 cent at 81.700 cents per pound.
But deferred hog contracts appeared to draw support from renewed hopes for U.S.-China trade talks after U.S. President Donald Trump said he would meet with Chinese President Xi Jinping at the G20 summit later this month.
Reporting by Julie Ingwersen; Editing by Cynthia Osterman