Commodity Blog

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Did Meat Become Too Expensive?

December 21, 2012 at 2:32 by Vladimir Vyun

Cattle futures went down on speculations that high prices will deter investors from buying the commodity. Cattle prices have rallied 17 percent since the end of April, while prices for wholesale beef were up 8 percent since the end of July. Analysts think that meat became too expensive and the current level of prices may hurt demand.

The commodities were also hurt by the general sentiment on markets. Traders are less willing to buy riskier assets while the future of the US economy remains unclear as politicians struggle to agree on methods for avoiding the fiscal cliff. Of course, the coming holiday season may alleviate the pressure, but so far that did not happen.

Futures for delivery of cattle in February declined 0.6 percent to $1.335 per pound by 13:00 on CME. Wholesale beef dropped to $1.9198 per pound, the lowest price since November 9, falling for the third trading session.

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