March 16, 2004

US Cattle Prices Increase Slightly

Wholesale cattle prices in the United States is showing slight signs of recovery following a 20% decrease on the discovery of mad cow disease in December last year.

Cattle reportedly traded at $US88 a hundredweight last week in Kansas, Oklahoma, and Texas, a significant increase from the $US75 bottom they hit in late December and only slightly off their record $US92 highs.

It was reported that unwavering consumer demand and a roughly 11 per cent cutback in production, had kept supplies tight and compensated for the 10 per cent loss due to lost exports.

Part of the production cutback was due to lower cattle weights, as many producers rushed their cattle to market during the first quarter on fears that prices would continue to drop.

As a result, the average weight of cattle processed for beef this past week was 1,231 pounds, down 16 pounds from a year ago.

Many economists predict prices to settle at $US70 to $US75 by summer, as more supply moves into the pipeline and seasonal demand crests.