Advisory Sees Higher Cattle Futures Prices

Enjoy prime-rib over the holidays…?  Well expect US cattle prices to spike as much as 20% in 2013, says the the world’s top beef producer.  Cattle ranchers are expected to be raising more beef instead of sending them to market.

Brazil’s “JBS” cattle-producing CEO says he expects his country’s beef production to slide up to 6% due to reduced processing.  When you take this into account, along with the USDA’s recent forecast of a US 4.2% reduction in beef production, then we have a real supply concern.

Kevin Riordan, director of research at Capital Trading Group in Chicago, stated today regarding the current cattle futures situation, “As grain prices retreat from records levels in 2012 ranchers should be able to retain cattle longer.  This will rebuild herds but also lead to lower beef supply as fewer animals are brought to slaughter.”

Cattle futures are mixed – live cattle futures in a technical uptrend, while feeder cattle down.  I am looking at both cattle futures markets for the best signals in their prospective trends.

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