LIVESTOCK-Cattle futures fall daily limit on jittery technical selling

By Julie Ingwersen

CHICAGO, Nov 5 (Reuters) - Live cattle and feeder cattle futures on the Chicago Mercantile Exchange fell their daily maximum on Wednesday, as worries about rising beef supplies triggered a flurry of technical selling and long liquidation, analysts said.

Some brokers cited uncertainty about the future of President Donald Trump's sweeping tariffs after U.S. Supreme Court justices raised doubts about the legality of the policy. Reduced tariffs could lead to increased beef imports.

But others said Wednesday's sell-off had more to do with technical selling, with the benchmark CME December live cattle contract LCZ25 dropping below last week's multi-month lows.

"A lot of this trading is done electronically, and once you start hitting some of the trip wires, it just keeps going," said Altin Kalo, chief economist at Steiner Consulting Group.

CME December live cattle futures LCZ25 settled down the daily limit of 7.25 cents at 220.525 cents per pound. January feeder cattle FCF26 ended down its limit of 9.25 cents at 319.975 cents per pound.

Daily limits will expand to 10.75 cents for live cattle futures and 13.75 cents for feeders for Thursday's trading session, the CME said.

Live and feeder cattle futures scaled all-time highs in mid-October, buoyed by soaring beef prices as the U.S. cattle herd fell to its smallest size in decades after a lengthy drought. An outbreak of the screwworm parasite in Mexico prompted U.S. officials in May to largely halt imports of Mexican feeder cattle, further tightening supplies.

But futures have since tumbled, buffeted by uncertainty after the administration of U.S. President Donald Trump took steps to lower beef prices. Trump last month encouraged beef imports from Argentina and urged cattle ranchers to lower prices.

Traders are also nervous about prospects for reopening the U.S. border to Mexican cattle. U.S. Agriculture Secretary Brooke Rollins said this week that President Trump was "very focused" on reopening the border, although she was not yet ready to make a move while Mexico works to contain the screwworm outbreak.

"The very bullish zeitgeist that defined the cattle market the last several months has disintegrated over the last couple of weeks," said Doug Houghton, analyst with Brock Associates.

Hog futures closed mostly higher. Benchmark CME December lean hog futures LHZ25 settled up 0.675 cent at 80.600 cents per pound and February hogs LHG26 ended up 0.050 cent at 80.975 cents, while deferred contracts drifted lower.

The USDA priced pork carcasses at $97.54 per cwt on Wednesday afternoon, down $1.63 from Tuesday.