US imported beef prices drifted a further 1.5US¢ lower this week to average 196US¢/lb CIF (388¢/kg FAS), as market participants noted the lack of end-user interest in forward purchases. Despite the overall market expectation that lean beef prices will be high later in the year and into early 2013, a soft sentiment in the foodservice sector in the last two months, combined with speculation surrounding a short-term price dip in October and November has seen buyers take a cautious approach.
Although the drought continues to place pressure on many US cow-calf producers, anecdotal evidence suggested cow slaughter in the lead up to cooler months of 2012 will be well below the same period last year – when the worst drought in 100 years struck major cow-calf producers across the Southern Plains.
The short-term outlook for US imported lean grinding beef prices are largely hinged upon the US domestic cow slaughter and supply from Australia. With the current dry conditions across the eastern states, Queensland cattle throughput is expected to be sustained, facilitating steady volumes to the US.
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