Cattle, Hog Futures Fall as High Beef, Pork Costs Erode Demand

US - Cattle futures fell to a two-week low in Chicago, and hog prices fell the most in two months, on speculation that higher costs for beef and pork will erode U.S. demand for the meats.
calendar icon 15 March 2007
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The cost of wholesale beef sold to restaurants and grocers has jumped 16 percent this year and pork prices rose as much as 14 percent, government data show. Feedlots have been selling cattle at below-normal weights because of the highest cost for corn feed in a decade, reducing supplies of choice cuts.

"Beef prices have skyrocketed," said Dan Bluntzer, research director at Frontier Risk Management in Chicago. "When you cram these prices down in such a short period, people will back off beef for a while and look for cheaper meat."

Cattle for June delivery fell 0.975 cent, or 1 percent, to 96.425 cents a pound on the Chicago Mercantile Exchange, after reaching 95.5 cents, the lowest for a most-active contract since Feb. 28. The June contract became the most actively traded contract this week. Cattle for April delivery fell 0.125 cent, or 0.1 percent, to 99.975 cents a pound.

Source: Bloomberg.com

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