Cattle Markets Rally Amid Positive Price Factors

Strategic Insights -

Chicago Mercantile Exchange live cattle futures rallied to their highest levels in more than three weeks in active trade amid a confluence of positive price factors, according to the Dow Jones report. The market's momentum was fueled by the Japan government's recent decision to partially lift the ban on US beef imports, following a government panel's acceptance of US assurances that a specific grade of US beef would be free of mad cow disease. Meanwhile, the USDA Attache reported that Japan's broiler market is expected to recover in 2005, following weak consumption and lower imports in 2004 due to Avian Influenza outbreaks.

Key Takeaways:

  • Chicago Mercantile Exchange live cattle futures rallied to their highest levels in more than three weeks.
  • The rally was driven by positive price factors, including the partial lifting of the ban on US beef imports by Japan.
  • The Japan government's decision was made after a government panel accepted US assurances that a specific grade of US beef would be free of mad cow disease.
  • The USDA Attache reported that Japan's broiler market is expected to recover in 2005, following weak consumption and lower imports in 2004.
  • The National Cattlemen's Beef Association tied the reopening of live cattle trade with Canada to other unresolved trade issues, such as the reopening of Japan, South Korea, and Mexico to US beef.
  • Argentina exported 478,124 metric tons of beef in 2004, a 26% increase from 379,366 tons in 2003.

Statistics:

  • Chicago Mercantile Exchange live cattle futures rallied to their highest levels in more than three weeks.
  • Japan's broiler market is expected to recover in 2005, following weak consumption and lower imports in 2004.
  • Argentina exported 478,124 metric tons of beef in 2004, a 26% increase from 379,366 tons in 2003.
  • The amount of beef exported by Argentina in 2004 was worth $1.053 billion, a 51% increase from $694 million in 2003.
  • The partial lifting of the ban on US beef imports by Japan was a significant positive price factor for the cattle market.

Sources:

  • "CME Cattle Midday: More Multi-Week Tops; Cash, Charts" (Dow Jones)
  • "Japan Moves Closer To Lifting Ban On US Beef Imports" (AP)
  • "UN Group Says Mad Cow Cases In US, Canada Were Isolated" (AP)
  • "NCBA Mtg: Grp Ties Border Reopening To Trade Issues" (Dow Jones)
  • "USDA Attache: Japanese Broiler Market Expected To Recover In '05" (USDA Foreign Agricultural Service)
  • "Argentina's 2004 Beef Exports Total 478,124 MT - Senasa" (Dow Jones)
  • "US Commodities May Lose Out In Proposed Food Aid Shift" (Dow Jones)
  • "THE MARKETS: CME Pork Outlook: Hogs, Bellies Draw Mixed Opinions" (Dow Jones)