US imported beef market falls; A$ rises
08 October 2015
The imported beef market in the US continued following the general cattle and beef trend this week, moving lower again across most categories in US$ terms. This was compounded in A$ terms by a sharp appreciation in the A$ against the US$ – up almost 2¢ in the last week, to 71.9US¢ for 1A$.
Prices for beef products to be delivered in the next 7–45 days fell across the board, and fattier products have now, for consecutive weeks, not generated a price quote in the Steiner Consulting Group report. The imported 90CL cow beef indicator was 6US¢ lower, at 223US¢/lb CIF this week (down 28.5A¢, to 690.4A¢/kg CIF). Buyers remain relatively inactive, and prices out to early 2016 are reportedly even lower than current levels, but this is very uncertain at present.
The most recent weekly CattleFax Update suggests that the current decline in the beef market will result in setting a new low point for the industry moving forward. They note that the 2014 price rises were overheated, while the downturn this year is an overcorrection, which will move back up through 2016.
After an extended period of price declines, there were some signs of improvement in the cattle futures markets (which have been falling since June) this week, with prices moving up in the last few days. The volatility of these markets over the last few months demonstrates that they are not a perfect indicator of where prices will be down the track, it does suggest confidence returning to the cattle sector.
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