Global Beef Prices Struggle

US Beef Traders Go to New Life-of-Contract Highs

Victoria G Myers
By  Victoria G. Myers , Progressive Farmer Senior Editor
The U.S. cow herd continues to face rebuilding challenges. (DTN/Progressive Farmer file photo by Gregg Hillyer)

Compared to a year ago, U.S. cattle prices are up nearly 30%, while Australian cattle prices are down 30%. It's been a decade since there was such a wide price split between the two. And it's not just Australia where prices are sliding.

Angus Gidley-Baird, Rabobank's senior animal protein analyst, said wide price separations are going to have consequences for beef exporters moving forward. It's a market trend that will ultimately shift trade volumes globally.

These findings are in RaboResearch's third-quarter report, "Global Beef Markets: Lower Demand in Most Regions and Diverging Prices to Affect Exports." In summary, the report said that while North America and Europe still have positive demand, consumers in the rest of the world are buying less beef, causing prices to soften.

Part of the issue, reported Gidley-Baird, is that along with softening demand, supply chains are full. Asian beef purchases in anticipation of economic recovery from COVID, have not been consumed. That creates a glut of beef that isn't being used yet. And beef isn't the only protein making up that glut; it extends to pork and chicken as well.


In key beef-production areas of the U.S., inventory continues to show herd liquidation.

Feedyard inventories were at 13.1 million head, reflecting a drop of 300,000 from the prior year. Feeder cattle and calf supplies outside of feedyards were at 34.4 million head, a 1.3-million-head drop. The beef cow inventory was at 29.4 million head, an 800,000 drop.

U.S. price, meanwhile, is above the 12-month average, at $7.79 per pound for July, all-fresh retail. This price is 6% over last year's. That is with a 1% drop in consumer beef demand domestically. The U.S. beef trade showed exports for the second quarter down 14%, and imports up 5%. U.S. exports to South Korea, Japan and China are down 14% for the first half of 2023.


When it comes to beef imports to the U.S., Mexico continues as a ready source. But drought conditions in that country, while weakening in the north, appear to be intensifying in the south.

The Rabobank report said of Mexico: "The Pacific coast and center of the country have seen drought worsen with little relief recently. Herds from Jalisco to Guerrero remain particularly challenged under moderate to extreme drought conditions, while the herd in Chiapas continues to be challenged by drier weather. Furthermore, these drought-stressed states represent major feedstuff-producing regions and bear watching closely throughout the next several months."

Despite those challenges, exports of feeder cattle and calves to the U.S. are strong, showing a 38% increase during the first half of this year, compared to the same time a year ago. Imported Mexican steer prices, according to USDA port information, are averaging $200 per hundredweight (cwt) for five-weight steers. This is $80/cwt below the average U.S. price for the same five-weight class.


DTN Livestock Analyst ShayLe Stewart reported last week that traders are now fully acknowledging that cattle supplies in the U.S. are going to "remain alarmingly thin well into 2024." Several nearby contracts closed at new life-of-contract highs, she noted.

"The biggest reason why I believe the cattle complex is seeing greater technical support as of late is that the build-back of the U.S. cow herd hasn't started yet, which likely means that the duration of the market's strength will continue for at least another year -- if not more."

To see more of Stewart's comments on these new contract highs, go here:….

Victoria Myers can be reached at

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Victoria Myers