Cattle futures are all over the charts, and apparently all over the map as 150 cows have been recently loaded-up onto a Boeing 747 in Australia to be flown to China’s central interior for processing. Live cattle futures are down $3.10 per pound today currently trading at $128.82 (CWT) at Chicago’s Mercantile Exchange.
Its the insatiable demand for what was once referred to as “millionaires meat” in China and the profit beef brings to the nation that has them coming in via 747, and if you want to get the cattle inland there is no other way. Beef sells for twice the price in China than the benchmark-rate in Australia and the Chinese are pegged to 2.2M tons of beef by 2025 (according to Rabobank).
Jeff Evans, Vice-President of the Managed Accounts Division for RMB Group in Chicago, shared his fundamental view of the cattle futures market by stating, “With the price of cattle (futures) coming back down to reality, the Chinese demand for beef is becoming more attainable.” Evans added, “There are more middle class in China than ever before and with the rapid urbanization happening all over the country, beef will be on the menu – they are seeing to it.”
Cattle futures trend has been back and forth with a vengeance these past couple of months – currently down. With new lows for cattle futures made just today, there is no bottom for this market yet in sight.
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