Beef Prices Climb as Cattle Battle Cold, Drought

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Jan. 28 (Bloomberg) -- Bloomberg’s Olivia Sterns and Larry Shover, CEO at SFG Alternatives, look at the cattle market on today’s “Futures In Focus” on Bloomberg Television's "In The Loop."

Taking a look at cattle futures.

Larry, let's start with the weather, how badly is this hitting cattle herds?

It is shrinking a herd that has already shrunk.

The herds are so small and have been shrinking every year for the past six years.

Herds right now are definitely underweight.

We won't really know until thursday when the weekly sales report is coming out.

It is incredible to hear that we have the smallest herds in america since the 1960's. what is this going to mean for us in the grocery aisles?

Are we going to see higher prices for state?

I think we will absolutely see higher prices unless americans change your eating habits.

The fact is packers continue to chase cash, the cash price is trading three to four dollars over the futures price.

All the while margins are still positive it means wholesale of the retailer is willing to pay the price, americans are willing to pay the price.

What will cause that description?

Any other catalysts that could cut -- that the turn prices around?

It is going to affect the exports it is something a lot of people are worried about.

They really believe these drought in texas, the shrinking herds, and the increased man for meet is the driving factor for making beef prices higher going forward.

Talk to me about horizon a little bit.

It looks a we have polar fulltext two or three.

The cold weather is in fact heading south.

Let's take an outlook out further.

What does it look like for cattle prices in march, april, may?

For the spring it is looking higher.

This is the season for contango meant.

We are seeing prices in april very high right now.

This is the season when they should be trading much lower because this is a fattening season for the cattle.

The cash is so high.

With that in mind, we are going to see a spike that mimics last year.

Thank you so much.

An outlook on cattle prices, set to rise as the cold weather digs in.

He will be back on the market in 30 minutes.

Market makers is up next.

This text has been automatically generated. It may not be 100% accurate.

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