Tyson to eliminate purchase of cattle fed Zilmax

Tyson Foods said this week come September it will suspend the purchases of cattle which have ingested the feed additive Zilmax .

Tyson said it made the decision after recent instances of cattle arriving at some of its plants with difficulty walking or inability to move. The company said it was unsure what caused the problems, but some animal health experts suggested a possible link to Zilmax.

After Tyson’s decision was made public, cattle futures began to rally on the Chicago Mercantile Exchange as removing Zilmax from feed can result in lighter weights.

Cattle futures hit a three-month high fueled by speculation that beef prices could move higher on tighter supplies and lighter weights.    

August live cattle futures ended up $1.45 at $122.765 on Thursday (Aug.8). The October contract closed $2.40 higher at $127.075.

Merck & Co., the manufacturer of Zilmax, said this week the drug was deemed safe for cattle after extensive reviews by regulatory authorities.