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Friday, October 03, 2008
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CME: Corn Prices Sharply Decline

US - CME's Daily Livestock Report for 2nd October 2008.

Livestock futures were again sharply lower in Thursday trading on fears that beef and pork prices will continue to be negatively impacted by the slowing US economy. In addition to responding to the general swoon in commodity and equity values, however, a number of factors have been at play in the livestock complex:

  • Corn prices have declined sharply since their peak in late June. December corn futures closed limit down on Thursday and are currently almost 50% lower than a few months ago. Seasonally corn prices decline into harvest in October and this year is no different. However, recent USDA reports pointing to a slowdown in demand have clearly negatively impacted corn prices. Feedlots will likely take advantage of the current slowdown to cover needs for the next few months. However, noone really knows what the real economic impact of the current financial crisis will be and, with significant negative margins for much of this year, feedlots will have to make a really convincing argument to their bankers to get them enough financing to cover significant out-front needs.


Daily Livestock Report - Copyright © 2008 CME. All rights reserved.


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