Commodities: Cattle futures poised to drop

CHICAGO: U.S. cattle futures may fall from recent record highs as the rally in prices encourages producers to sell more animals and as high beef costs slow consumer demand, some feedlot owners say.
calendar icon 12 March 2007
clock icon 1 minute read
Cattle for April delivery rose to a record $1.0175 a pound Friday on the Chicago Mercantile Exchange, and prices have jumped more than 20 percent in the past year. Wholesale beef prices have jumped 10 percent in the past month to $1.5963 a pound, the highest since December 2005.

Feedlot owners, who fatten cattle to be sold for slaughter, are getting 97 cents to $1 a pound, enough to encourage more sales to processors, said Chris Hitch, a vice president at Hitch Enterprises in Guymon, Oklahoma, an owner of feedlots in Oklahoma and Kansas that can hold about 150,000 head of cattle.

"We're willing sellers at that price," Hitch said. "We say, 'It's overpriced,' or 'Packers are going to cut kills,' and we talk ourselves into the idea that we're getting too much for our own cattle."

Cattle prices have risen on concerns about supply after four blizzards last month, and on high corn feed prices. Corn has jumped 81 percent in the past year to a 10-year high of about $4.19 a bushel.

Source:International Herald Tribune
© 2000 - 2023 - Global Ag Media. All Rights Reserved | No part of this site may be reproduced without permission.