Modern cattle-raising can be traced back at least 8,500 years to Europe and the Middle East. Cattle first appeared in the U.S. during the 16th century when Spanish explorer Ponce de Leon brought the animals to Florida in 1521; organized ranching began in Florida in 1565. Today, cattle are raised around the world and are used for milk, meat, leather and labor.
“Live cattle” refers to cattle that have reached the necessary weight for slaughter – typically about 1,250 pounds. Once feeder cattle reach a certain weight, they are sent to feedlots, where they are fattened into live cattle and sold to meat packers. (See the "Feeder Cattle" section in this tutorial for information in trading in that commodity.)
Contract Specifications
|
Ticker Symbol |
LE (CME Globex) |
|
Contract Size |
40,000 pounds |
|
Contract Months |
G, J, M, Q, V, Z |
|
Trading Hours |
CME Globex: Monday – Friday, 9:30 a.m. – 2:05 p.m. |
|
Last Trading Day |
Last business day of the contract month |
|
Price Quote |
U.S. dollars and cents per pound |
|
Tick Size |
$0.00025 per pound ($10 per contract) |
Production
After a nine-month gestation period, calves are born weighing between 55 and 100 pounds. With a natural lifespan of about 15 years, cattle can grow to 1,900 pounds. The U.S. produces about 19% of the world’s beef, making it the largest producer in the world. Other top producers include Brazil, the European Union, China, India and Argentina.
Price Drivers
The price of live cattle is influenced by the following factors:
- weather (which affects crops like hay and corn, which serve as cattle feed)
- seasonality
- global demand for beef
- food safety (recalls and outbreaks, such as bovine spongiform encephalopathy)
- value of the U.S. dollar
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