U.S. livestock futures were mixed Thursday, as live cattle fell on stagnant cash bids and profit-taking following recent gains.
CME live cattle for October delivery closed down 2.1 cents, or 1.7%, to $1.189, while feeder cattle settled down 1.175 to $1.37775.
After climbing sharply the past couple of weeks, the market seemed to "run out of buyers," said Scot Miller, head of Scot A. Miller and Associates.
Some traders expected a continued climb in cash bids this week following last week's jump, but light trading in Texas and Nebraska that emerged Thursday was in line with bids last week.
"I think some of those cash expectations have been tempered by today's action," Miller said.
Meanwhile, corn futures fell sharply Thursday, which could encourage more future livestock production.
The market has been dealing with an influx of supplies as ranchers send their cattle to feedlots sooner than normal because of drought in the southern Plains. But ultimately the drought will lead to tighter supplies later this fall, analysts say.
About 84% of Texas cattle ranchers reduced the size of their herds as a result of the severe drought in the state, according to a survey released by the Texas and Southwestern Cattle Raisers Association on Thursday.
Light cash cattle trading developed in Texas at $1.18 a pound live basis and in Nebraska at $1.87 a pound dressed, steady with the high end of last week's respective trading ranges. Beef processors were unwilling to bid higher prices as margins have tightened and futures prices tumbled today.
The U.S. Department of Agriculture reported choice boxed beef prices midday Thursday up 51 cents to $185.08 a hundred pounds and select beef off 12 cents to $173.42 a hundred pounds on 170 total loads.
The latest HedgersEdge packer margin index was plus $2.60 a head, compared with $7.90 the previous day. This is an estimate of packer returns on cattle slaughtered and processed expressed in the form of an index.