April 20, 2012

US cattle prices increase as beef demand rise

US cattle futures climbed for the third time on signs of rising demand for beef.

Wholesale-beef prices jumped 1.2% to US$1.8576 a pound yesterday, the highest since March 26 and the fourth straight increase, U.S. Department of Agriculture data show. Meatpackers processed an estimated 347,000 head of cattle this week through yesterday, up 3.3% from the same period a week earlier, USDA data show.

"Boxed beef has been doing fine," Mark Schultz, the chief analyst at Northstar Commodity Investment Co in Minneapolis, said in a telephone interview. Current meat prices may allow processors to buy more cattle and bid more for available supply, he said.

Cattle futures for June delivery rose 0.5% to US$1.15425 a pound at 10:13 a.m. on the Chicago Mercantile Exchange. Before today, prices retreated 5.5% this year.

Spot-steer prices averaged US$1.22 a pound in the first two days of this week, up 1.8% from the same period a week earlier, government data show.

Hog futures for June settlement increased 0.6% to 87.875 cents a pound in Chicago. Before today, prices rose 3.6% this year.

Feeder-cattle futures for August settlement fell less than 0.1% to US$1.55475 a pound in Chicago.