Cattle Futures Strengthen Despite Russian Import Limit28 December 2012
US – Exports, currently taking around 10 per cent of the market, are not thought to be responsible for any recovery in cattle futures and instead domestic factors have been labelled as market triggers by John Michael Riley, Professor at the Department of Agricultural Economics, Mississippi State University.
Russia has revealed it will limit its imports of US beef which currently accounts for 6.6 per cent of the export market. This, Professor Riley has stated, is predicted to impact exports, dropping them by 1 per cent in 2012 and 2013.
Following the news of Russia’s limit the four nearest futures contracts gain around 2.45 per cent. This increase took place between between December 10 and December 17.
More recently cattle futures have increased further. An improving employment outlook and a general domestic economic lift combining with tightening supplies are believed to be the domestic reasons for this rise.
Beef Production and USA ExportsThe graph shows USA exports as a per cent of production with forecast figures.
Showed above is the leap in beef export trade in 2011 after a period of restricted commerce due to imposed BSE legislation. An overall increase was experience between 1987 and 2000. In total US beef exports account for 10 per cent of overall domestic production. In 2011 this figure rose to 2.8 billion pounds of beef in a peak year for beef exports that brought figures back to pre-BSE levels.
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