By Karl Plume
CHICAGO, Nov 29 (Reuters) – Chicago Mercantile Exchange live cattle futures rose to multi-year highs on Monday but closed lower as profit-taking and technical selling clipped gains, traders said.
The spread of a new coronavirus variant sparked demand worries as livestock traders feared renewed restrictions on travel and restaurant occupancy.
But strong beef packer margins and elevated cash cattle prices continued to underpin the market.
“Cattle were pressured by profit-taking and speculative selling. The market has been technically overbought and probably due for a correction,” said Doug Houghton, analyst with Brock Capital Management.
“The COVID news … was part of it too. There are demand concerns,” he said.
CME February live cattle posted a contract high of 141.850 cents per pound but ended 1.900 cents lower at 139.300 cents per pound. December live cattle finished 1.175 cents lower at 136.925 cents after peaking at 139.125 cents early in the day, the highest for a front-month contract since March 2016.
Feeder cattle futures followed live cattle lower despite sharply lower corn prices, normally a supportive factor.
CME January feeder cattle fell 1.425 cents to 165.725 cents per pound.
Lean hog futures ended mixed, with the actively traded February contract pressured by a weak cash market and deferred contracts supported by expectations for tighter supplies of hogs in 2022.
CME February lean hogs settled 0.100 cent lower at 80.925 cents per pound. Back months were up as much as 1.525 cents.
(Reporting by Karl Plume in Chicago; Editing by Krishna Chandra Eluri)