US cattle, hog futures tumble on dollar gains; slower meat exports

Cattle futures fell to a four-month low and hogs dropped as the dollar gained and equities tumbled, raising concern that global demand for US beef and pork will slow.

The dollar rose as much as 1.4% against a basket of currencies on concern that Europe's sovereign-debt crisis is spreading. The Standard & Poor's 500 Index fell to the lowest level since November. Meat exports, which rebounded this year, may drop as prospects dim for the economy, according to analysts.

Analysts said there is a perception of potentially lower beef demand based on economic fears, and possibly lower exports based on the rising dollar, noting that general commodity-market liquidation drove livestock futures lower.

Cattle futures for August delivery dropped 1.125 cents, or 1.2%, to 89.075 cents a pound on the CME. Earlier, the price touched 88.5 cents, the lowest for a most-active contract since January 12. The commodity has declined 5.5% this month.

Feeder-cattle futures for August settlement fell 1.575 cents, or 1.4%, to US$1.07275 a pound.

Hog futures for July settlement declined 0.375 cent, or 0.5%, to 82 cents a pound. The price has dropped 5% this month.

Meanwhile, US beef shipments to South Korea, the fifth-largest buyer, may decline should tensions escalate with North Korea, said analysts. The South Korean won dropped to the lowest level since July against the dollar.

In the first quarter, US beef exports to South Korea climbed 8.5% from a year earlier, according to the USDA.

US boneless-beef imports from Australia also may increase after the dollar climbed to a 10-month high today against the Australian currency, Broadbent said. Boneless beef is used to make hamburger. Australia is the largest seller of beef to the U.S., behind Canada.