After the pork, the US beef industry is also in crisis oversupply, causing prices to bottom half a year.
The American pork market is quite influenced by the world because of the amount of beef produced and sold from other countries. However, concerns are mounting in the country as beef supplies are likely to be surplus in the coming months.
US Department of Agriculture said in late March, the number of breeding cows increased 7.3% in February, exceeding the estimate given earlier is up 4.2%. 1/3 day supply beef rose 8.8% over the same period in 2017, and also exceeded forecasts.
“We are increasing herd back in recent years since reduced production scale, creating a ton of products and the barn on the farm have been filled,” said Tim Hackbarth, expert risk management Top Third Ag Marketing in Chicago said. In addition, the report published in April showed that the amount of beef sold from farms slower than usual. Analysts US market, Mr. Len Steiner of Steiner consulting firm, analyzed and predicted the rate will be higher slaughter lot late April and June.
“According to our calculations, the supply of cattle raised more than 120 days on April 1 is about 24% more than the same period last year. We expect the number of slaughtered cows to increase by more than 500,000 in the second half of April, and possibly by 530,000 to 540,000 in June, “Steiner said.
It is estimated that in the first week of April, the number of slaughtered cattle in the United States is about 485,000.
Estimated in the first week of April, the number of cattle slaughtered in the United States about 485,000 children.
Concerned about the amount of beef on the market have affected beef prices in the US, with beef prices dropped CME delivered on the floor of 22% from the highest level down to 101.375 USD Date 20/2 17/3 and bottomed on November 6 Tuesday 26/3 months. In the session today (24/5) beef prices delivered in June are at 105, 425 USD.
Prices fell, but the beef packer huge profits
Meanwhile, US beef packers, including Tyson Foods and Cargill, are on track to record high profits historically, as cattle prices fell sharply amid rising supply and Americans turned to use beef for their summer barbecue.
According to calculations from HedgersEdge.com, May 23, US beef packers earned $ 236.9 million for each processed cow, the highest level this year, but still a bit lower than a record $ 254.35 made in June last year.
Kate McCullock, a senior economist at the Livestock Marketing Information Center, says that excess cattle are moving through the system effectively when packers use it to increase profits. However, beef demand is very important for a consistent flow of cattle in the system
“In short, there is a need to keep the beef stock, not just in the grilling season when demand for beef rises, but also in the months to come,” McCullock said.