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Feeder Cattle Near Record, Higher Beef Prices Expected

May 1, 2014 at 18:31 by Vladimir Vyun

Futures for feeder-cattle were trading near the record level, resulting in concerns that growth of prices for beef will accelerate. Prices for cattle demonstrated the longest rally in 22 years as US farmers were sending fewer animals for slaughter. Meatpackers processed 7 percent less cows in the first quarter of this year compared to the same period a year ago.

The US Department of Agriculture estimated that beef prices for consumers may rise 3.5 percent in 2014. It is the fastest inflation since 2011. Wholesale prices for beef surged as much as 16 percent this year, while the average retail price for the meat reached the all-time high of $3.698 per pound in March.

August futures for delivery of feeder cattle climbed as much as $0.0393 (2.10 percent) to $1.9048 per pound as of 18:01 GMT on CME today. July contract for live cattle advanced $0.0200 (1.46 percent) to $1.3903 per pound.

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