The Chicago Mercantile Exchange will no longer accept delivery of cattle fed the growth additive Zilmax on Oct. 7 to conform with exchange guidelines for deliveries against CME live cattle futures, said CME in a statement on Monday.
The guideline will be implemented beginning with October deliveries on Oct. 7, the CME managing director of Commodity Research and Product Development, David Lehman, told Reuters on Monday.
"We are letting the market know these Zilmax cattle no longer are merchantable in our view from a contract specification perspective because they will not be accepted by a majority of our approved slaughterhouses," Lehman said.
The exchange based its decision after two major packers discontinued purchases of Zilmax-fed cattle, with the possibility that others may follow suit, the exchange said.
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