Sizeable drop in US cattle herd will see beef production hit 20-year low

The cattle herd in the US, the world’s largest beef producer, has probably fallen to the smallest in 63 years, a Bloomberg survey showed.

More than 80% of Texas, the biggest producing state, is still abnormally dry, and ranchers such as Weldon are struggling to recover. Fewer cattle will mean production in the $85bn (€63bn) beef industry drops to a 20-year low in 2014, the US Department of Agriculture said. Retail costs for the meat are at an all-time high, government data show.

Cattle futures rose 4.4% this month and touched $1.432 (€1) a pound on Jan 22, the highest since trading began on the Chicago Mercantile Exchange in 1964. The Standard & Poor’s GSCI gauge of 24 raw materials dropped 0.9% in 2014, and the MSCI All-Country World Index of equities fell 3.6%. The Bloomberg Dollar Index, a gauge against 10 major trading partners, climbed 1.1%, while the Bloomberg Treasury Bond Index rose 1.6%.