A number of factors are contributing to record live and slaughtered cattle prices in key beef production markets around the world, according to a recent study by Rabobank.
The Russian ban on imports from the US and the EU has been good news for Brazil and China, who have benefited from Russia seeking alternative suppliers. Brazil recorded record nominal values for live cattle in August, as prices netted R$130 ($54; €43) per 15kg.
Australia seems to be bouncing back from its drought spell, reporting high slaughter levels of over 8 million head of cattle in the year 2013/14 for the second consecutive year, a 35-year record.
Australian live cattle exports also rose by 79 percent in the same period compared to last year, with the country exporting 1.13 million head of livestock.
Generally, supply in key producing markets such as China, Australia and New Zealand is constrained and will remain so for the rest of 2014, with producers enjoying higher prices as global demand continues to be strong.
Private investment across these regions looks to benefit from these favourable metrics, with examples such as Australian Pastoral Fund, SLM Partners and Sherpa Asset Management all possessing holdings in key beef production markets.
The US reports a different story. Price volatility has characterised the beef sector in the US, with fed cattle prices picking up from a low of $144 per centum weight to $164 per centum weight in late July and back down to $152 per centum weight in August. Slaughter levels have been dropping throughout the year, resulting in an overall decline of 5.6 percent in US beef production. Domestic demand remains high, however, so US producers can still rely on the home market, according to Rabobank.