Hedging Against Rising Live Cattle Prices using Live Cattle Futures

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Top Broker!
    Best Choice For Beginners!
    Free Trading Education!
    Free Demo Account!
    Big Sign-up Bonus!

  • BINOMO
    BINOMO

    Perfect For Experienced Traders!

Live Cattle Futures

Until they reach a specific weight (typically 600-800 lbs), live cattle are specially raised for beef production. This process begins when they are calves and ends when they reach the required weight; after this, they are then transferred to feedlots and considered “feeder cattle”. Contracts for live cattle in the CME are for 18 metric tons.

Live Cattle Futures Contract Specifications
Contract Size 40,000 pounds (

18 metric tons)

Price Quotation Cents per pound
Trading Hours Monday 9:05 a.m. Central Time/CT-Opening. At 4:00 p.m. CT on Monday- Thursday, the markets halt and restart at 8:00 a.m. CT on the next morning. Friday 1:55 p.m. CT-Close
Minimum Price Fluctuation $.00025 per pound ($10 per contract)
Product Code CME Globex: LE
CME ClearPort: 48
Clearing: 48
TAS: LET
Listed Contracts February (G), April (J), June (M), August (Q), October (V) & December (Z)
Settlement Method Deliverable
Last Trade Date Last business day of the contract month, 12:00 p.m.
Trade At Marker Or Trade At Settlement Rules Trading at settlement is available for first 2 listed futures contract months, a calendar spread between the first and second contract month, and are subject to the existing TAS rules. The Last Trade Date for CME Livestock TAS products will be the second to last business day in the month prior to the named contract month.

Trading in all CME Livestock TAS products will be 9:05-13:00 Chicago time on Mondays or on the Tuesdays that follow a Monday holiday, and Tuesday through Friday 8:00-13:00, Chicago time.

TAS products will trade a total of four ticks above and below the settlement price in ticks of the corresponding futures contract (0.00025), off of a “Base Price” of 0 to create a differential (plus or minus 4 ticks) versus settlement in the underlying product on a 1 to 1 basis. A trade done at the Base Price of 0 will correspond to a “traditional” TAS trade which will clear exactly at the final settlement price of the day.

Settlement Procedures Livestock Futures Settlement Procedures
Exchange Rules These contracts are listed with, and subject to, the rules and regulations of CME.
Source: CME Group

Live Cattle Facts

Most cattle are bred in the summer to ensure that their calves are born in the spring season because of both the temped climate and the abundance of pasture to feed on. Around 8 months of age, cattle are weaned from their mothers and sent to feed lots in order to encourage growth to full size (600-800 lbs.). At the feed lots, live cattle are fed a certain diet in order to inhibit weight gain. When the cattle reach an approximate weight of 1,200 lbs., they are considered to be suitable for slaughter and are sold to meat packers. The Unites States exports over 2 billion pounds of beef very year.

Live cattle futures and options are traded in cents per pound on the Chicago Mercantile Exchange. Live cattle futures can allow traders to address price risk among those involved in the trade of live cattle and to assess supply and demand of cattle for both the current and future outlook.

Last updated October 2020

Additional Info

Recent Posts on Live Cattle

  • Beyond the Spotlight: March 23, 2020 (Rice, Cocoa, Cattle) (3/23/2020) – Beyond the Spotlight is a weekly video released on Mondays that spotlights two or three markets that may become trading opportunities for the week ahead. This enables you as a subscriber of the Trade Spotlight advisory service to look ahead with us, while potentially creating additional trading opportunities for yourself. The week’s video linked below… Read more.
  • Trade Spotlight: Futures – Weekly Summary: Live Cattle (12/20/2020) – The Trade Spotlight is working a short Live Cattle order.
  • Trade Spotlight: Futures – Weekly Summary: Chicago Wheat, Live Cattle (12/13/2020) – The Trade Spotlight was stopped out of a long Chicago Wheat position and is working a short Live Cattle order.

Primary Sidebar

Tips & Strategies

The FED, USD, and the Coronavirus Outbreak

The 2020 outbreak of the novel coronavirus (COVID-19) created a financial environment driven by angst and trepidation. COVID-19 panic swept the globe, placing the world’s capital structure under extreme pressure. The result was consistently high volatilities in the commodity, equity, currency, and debt markets.

Is the Coronavirus Causing a Global Recession?

Traditional financial theory suggests that a recession is two consecutive quarters of negative growth in a nation’s gross domestic product (GDP). The underpinnings of these types of economic downturns vary. Typically, a recession is attributed to commodity pricing instability, market crashes, inflation, or extraordinary events.

A Report on the System Downward Bias in Live Cattle Futures Prices

Do you want to read the rest of this article?

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Top Broker!
    Best Choice For Beginners!
    Free Trading Education!
    Free Demo Account!
    Big Sign-up Bonus!

  • BINOMO
    BINOMO

    Perfect For Experienced Traders!

Hedging Against Rising Live Cattle Prices using Live Cattle Futures

The price of Live Cattle Futures is 83.250 USD (per pound) today.

Will LC price drop / fall?

Yes. The Live Cattle Futures price may drop from 83.250 USD to 79.525 USD. The change will be -4.474%.

Will LC price grow / rise / go up?

Will LC price crash?

According to our analysis, this can happen.

Best Binary Options Brokers 2020:
  • BINARIUM
    BINARIUM

    Top Broker!
    Best Choice For Beginners!
    Free Trading Education!
    Free Demo Account!
    Big Sign-up Bonus!

  • BINOMO
    BINOMO

    Perfect For Experienced Traders!

Like this post? Please share to your friends:
How To Choose Binary Options Broker 2020
Leave a Reply

;-) :| :x :twisted: :smile: :shock: :sad: :roll: :razz: :oops: :o :mrgreen: :lol: :idea: :grin: :evil: :cry: :cool: :arrow: :???: :?: :!: