CHICAGO, Oct 8 (Reuters) - Chicago Mercantile Exchange cattle futures dropped for a second straight session on Thursday in a profit-taking and technical-selling retreat after sharp gains earlier this week and as wholesale cash beef prices turned lower.
An increase in imported cattle supplies from Mexico in recent weeks weighed on the feeder cattle market, but both feeder cattle and live cattle markets remain underpinned by generally strong consumer demand for beef.
CME December live cattle settled down 0.225 cent at 223.550 cents per pound after the actively traded contract hit a three-week high on Tuesday. November feeder cattle, which rallied to the highest point since mid-July on Tuesday, ended down 0.925 cent at 334.875 cents per pound.
Cattle futures struggled to hold on to early-week gains as cash market trade at Plains feedlots has been slow to develop this week, with limited packer bids in some areas suggesting the next wave of sales could be at lower prices, analysts said.
"In the absence of positive news out of the cash market, I think that there's just some profit-taking going on," said Doug Houghton, analyst with Brock Capital Management. "Beef prices have started to weaken again after showing strength last week, and we had that big run-up in cattle prices on Tuesday."