CHICAGO, Sept 13 (Reuters) - Chicago Mercantile Exchange
cattle futures fell to their lowest prices since June on Monday
on concerns that U.S. ranchers could temporarily lose a place to
deliver their livestock for slaughter after a fire damaged a JBS
USA beef plant.
JBS, owned by Brazilian firm JBS SA, halted
production at the plant in Grand Island, Nebraska, which
slaughters about 5% of U.S. cattle. The company later said it
expects to resume operations on Tuesday.
Uncertainty about when the plant will reopen rattled cattle
futures because the industry does not have extra capacity to
process livestock at other plants, analysts said. That means
cattle could back up in feedlots and on ranches if a major plant
closes for an extended period of time.
"When you lose that packing capacity, there's going to be
more cattle than capacity to go around," said Matt Wiegand, a
risk management consultant and commodity broker at FuturesOne in
Nebraska. "Then you're going to get cheaper cattle."
CME December live cattle tumbled 1.075 cent to
127.150 cents per pound and reached their lowest price since
June 1. October feeder cattle slid 2.275 cents to 155.450
cents per pound, touching its lowest since June 11.
Boxed beef prices eased even though production dipped due to
the plant fire. Choice cuts of boxed beef fell $1.29 to $325.93
per cwt, while select cuts dropped $1.21 to $292.16 per cwt, the
U.S. Department of Agriculture said.
The JBS plant has the capacity to slaughter 6,000 cattle a
day, according to industry estimates. Meatpackers typically
slaughter about 120,000 cattle per day nationwide.
On Monday, meat companies processed 114,000 cattle and
471,000 hogs, according to the USDA.
In the pork market, hog futures extended a recent slump.
Most-active CME October lean hog futures declined 1.675
cents to 80.775 cents per pound and hit its lowest price since
(Reporting by Tom Polansek; Editing by Shailesh Kuber)