991025 Cattle Futures Fall on Russian NewsOctober 9, 1999Washington - News that Russia will withdraw from the beef market because of high prices helped send cattle futures prices tumbling in trading Wednesday on the Chicago Mercantile Exchange. In other markets, hog and pork belly futures were mixed, cocoa futures continued their slide and grain and soybean futures prices were mixed. Live cattle futures prices began their slide on reports Russia will drop beef because prices are too high and use its food aid loan to purchase chicken, grain and protein meal. “We're talking about a significant amount of beef, about $70 million,” said analyst Charles Levitt of Alaron Trading Corp. “Obviously that takes something away from the consumption side of the beef and cattle market.” Overall, the market remains strong because of high cash prices being paid for beef, as demand is soaring on the approach of the holidays and millennium celebrations. Also hurting cattle prices was the weakness of hog futures, sent lower by high slaughter rates. The USDA quarterly hogs and pigs report, released Sept. 24, promised fewer hogs would be coming to market than is currently the case, Levitt said. According the report, the weekly slaughter would total 2 million hogs, Levitt said. The slaughter is about 2.1 million heads a week, close to year-ago levels. The losses in hog futures were limited by comments made Wednesday by USDA Secretary Dan Glickman to the House Agriculture Committee. He said more pork donations to Russia were a possibility, giving a boost to pork belly futures. December live cattle were .55 cent lower at 69.20 cents a pound; November feeder cattle were .53 cent lower at 82.37 cents a pound; December live hogs were .72 cent lower at 44.70 cents a pound; February pork bellies were .37 cent higher at 61.22 cents a pound. Grain and soybean futures prices were mixed on the Chicago Board of Trade. Soybean futures surged late as a rally in soyoil futures, triggered by technical factors, gave strength to the overall market. The rise was limited by the good weather in the U.S. soybean crop growing region, a boon for harvest activity. The mild conditions are expected to continue into the weekend. During his appearance before the House Agriculture Committee, Glickman said Russia is seeking 1 million metric tons of soybeans and soy products in a proposed food aid package. Corn futures prices finished fractionally higher in quiet trading, with many traders staying on the sidelines as they await the USDA's crop production and supply and demand reports, being released Friday. Corn prices received a lift from light farmer selling. Gains were limited by the brisk pace of the corn harvest. Wheat futures prices ended on a mixed note after falling in early trading. Losses were limited by commercial buying and the strength of the soybean market. Wheat futures continue to suffer from huge wheat stocks and poor export business. Wheat for December delivery was a 1/4 cent lower at $2.641/4 a bushel; December corn was 11/4 cents higher at $2.043/4 a bushel; December oats were 13/4 cents higher at $1.113/4 a bushel; November soybeans were 51/2 cents higher at $4.891/4 a bushel. Cocoa futures prices fell on New York's Coffee, Sugar & Cocoa Exchange on weak processing data from Europe. The Netherlands reported its third-quarter cocoa grind totaled 98,828 metric tons, a 9% decrease from the same quarter a year ago. The Netherlands is the world's largest cocoa processor, and the market is interpreting the figures as an indication cocoa demand is declining, analysts said. October is the start of the 1999-2000 cocoa season, and West African production appears very good, according to analysts.
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