Hope on the Horizon for Cattle Producers
Agriculture and the cattle market benefiting from a weak US dollar? Come on how could that be? I’m Susan Allen inviting you to stay tuned on today’s edition of the American rancher to find out. When the dollar is weak investors look to commodities to hedge and that could work out well for our nation’s cattle producers who have weathered down markets and dismal years. At recent cattle producer seminar respected economist Dr. Mark Welch forecasted that agricultural commodities purchased as hedges against inflation would provide help for cattle producers. In fact he believes that beef will command higher prices in 2010 because of optimal supply/demand conditions.. Several forces have combined to create this but notably it has attributed to drought throughout major cattle growing regions causing producers to make vast cuts in their herds this past year. Dr. Welch also cited that heifer retention rates are down as well, “ 2.2 percent from 2008 with the fewest heifers in over 30 years.” As beef production declines not only in the U.S. but worldwide (Argentina for example is facing a whopping 13% drop in it’s cattle inventory) a turn around in the global economy should spur consumer demand meaning mean higher beef prices and maybe, just maybe a perfect climate for US cattlemen to realize profits hopefully well into 2011. I’m Susan Allen
