By Joanna Newman
IT has been an encouraging week for US cattle and beef prices, with prices on an overall upward trend. Feeder cattle values have responded to sharply cheaper grain costs by climbing for the second week in a row. The 14% drop in maize prices in July has drastically cut cattle producers cost of gain and helped drive up the Chicago August feeder cattle contract to 77.5 cents/lb, a 3 cent increase since the start of the month. Mild weather and good precipitation in most regions are creating good grazing conditions for cattle out on grass, which could add to beef supply this autumn. Ranchers will be paying close attention to the monthly Cattle on Feed report on Friday, which will give insight into weights, headcounts and slaughter across the industry. At the slaughterhouses, packers have resumed their buying after the 4 July holiday weekend and are now paying around 64 cents/lb for live cattle, little changed from recent weeks. This market has largely succeeded in ignoring the recent collapse in the pig and pork complex. However, there is some concern that low pork prices may encourage retailers to feature pork at the expense of beef on the supermarket shelves, threatening beefs market share.