By Kelsey Gee 

CHICAGO--Prices of U.S. cattle futures tumbled to a new one-month low on Friday, reflecting fears about sluggish demand for livestock and beef.

August live-cattle shed 2.125 cents, or 1.9%, to $1.1035 a pound, the lowest settlement for a front-month contract since July 22, and a 2.8% decline on the week. Most-active October cattle declined 2.175 cents to $1.0635 a pound. September feeder-cattle futures fell 1.875 cents to $1.39925 a pound.

An uptick in supplies of beef, pork, poultry and other protein this year has sent prices for livestock on farms and meat at the grocery store to their lowest levels in years. While the deflation in food costs has been a boon for consumers, wholesale buyers and meat processors have had little incentive to bid aggressively to keep the supply chain of market-ready animals well-stocked.

The result has been weaker cattle and hog prices this summer. "The momentum in the cattle market is still lower," said Craig VanDyke, an analyst with Top Third Ag Marketing, an agricultural advisory firm in Chicago, noting that supplies remain ample.

At the same time, volatility in outside markets has kept would-be buyers at bay, as consumer demand for steak and other high-dollar proteins is closely tethered to disposable income.

Remarks by Federal Reserve Chairwoman Janet Yellen on Friday sparked an initial knee-jerk reaction to sell stocks and government bonds, according to traders, but those moves quickly reversed. In recent trading, stocks and U.S. Treasurys again drifted lower. "A number of outside markets were taking a toll on livestock," said Mr. VanDyke. "The moves are so extreme and so quick, it makes it so you can't leave your desk" to stop trading.

Prices in the hog market, meanwhile, surged. Analysts said they suspect traders were spread-trading the two markets, selling cattle while buying hog futures, though it was unclear why.

October futures rose 2.625 cents, or 4.5%, to 61.325 cents a pound, after hitting a two-week low on Thursday, marking a 1% decline for the week. December hog futures rose 2.15 cents to 56.625 cents a pound.

-Write to Kelsey Gee at kelsey.gee@wsj.com

(END) Dow Jones Newswires

August 26, 2016 15:27 ET (19:27 GMT)