CME cattle slip again on 'pink slime' controversy

Wed Apr 4, 2012 9:51am EDT

April 4 (Reuters) - CME live cattle futures fell early
Wednesday after wholesale beef prices resumed their downward
trek as the controversy over what critics call "pink slime"
continued to hang over the market.	
    * Traders also cited sliding equities markets and a stronger
dollar; both of which, they said, could hurt domestic and
foreign demand for U.S. beef and pork.	
    * "Outside markets are not helping, but the stock market has
been up a lot," a CME cattle trader said. 	
    * He said the retreat on Wall Street may be tied to debt
problems in Europe, as evidenced by sharp decline in overseas
financial markets, and "some old fashion profit taking."	
    * Hog futures dipped as well, prompted by Tuesday's
wholesale pork price drop.	
        	
    LIVE CATTLE - At 8:35 a.m. CDT (1435 GMT), April down
0.025 cent at 119.775 cents per lb and June down 0.100
cent at 115.950 cents.       	
    * Bullish investors moved to the sidelines after cash cattle
on Tuesday in Texas and Kansas traded $3 per cwt lower at $122
to $123.	
    * Packers balked at paying up for cattle given their
severely negative margins and the inability to stabilize falling
wholesale beef prices, or what's called the cutout.	
    * Those who wanted to buy futures were also disappointed
that wholesale beef movement remain slow at a time when
retailers typically gear up for post-Easter grilling specials.	
    * "I'm concerned because we start seeing demand for beef
pick up a few weeks before Easter, and yet the cutout continues
to go down," said the CME cattle trader.	
    * USDA Tuesday afternoon estimated the average price for
choice beef at wholesale at $183.09 per cwt, down $1.01. Select
cuts fell $1.44 to $180.91 with a total sales volume of 182
carloads. 	
	
    FEEDER CATTLE - April up 0.050 cent at 149.300 cents
per lb and May up 0.050 cent at 148.275 cents.     	
    * Futures traded in line with weak live cattle contracts.	
	
     LEAN HOGS - April down 0.150 cent per lb at 83.850
cents and June down 0.050 cent at 91.600 cents.          	
    * Futures were weighed by lower wholesale pork values,
although cash prices did firm.	
    * "The cutouts took a big drop, but cash reversed course.
That tells me product is so cheap that we should start seeing
some demand soon," an analyst said.	
    * The government's estimate for the average price of hogs at
the benchmark Iowa/southern Minnesota market Tuesday evening was
up 32 cent per cwt at $81.12.    	
    * USDA estimated the average wholesale pork price on Tuesday	
afternoon at $78.42 per cwt, down $1.53 cents.   	
	
 (Reporting by Theopolis Waters)