How the US beef industry will make $50 billion in new profits tomorrow, by Andrew Pfeiffer
Markets closed on Wednesday and the beef industry is on the verge of a record $50.5 billion profit, thanks in large part to a booming meat market in Mexico, a new report from the Congressional Research Service said.
That’s the largest single-day profit since 2000.
The report also showed that the industry’s production grew at a faster pace in 2016 than it did in 2015, and it will be a record-setting year for livestock production.
The USDA announced on Wednesday that it is going to open an additional 90,000 acres of cattle ranch land for cattle.
The announcement came a day after the USDA announced it would start selling beef to US customers.
The government’s beef supply has been stretched thin by the collapse of beef prices over the last year.
The US Department of Agriculture said on Tuesday that it was looking at raising beef prices to $80 a pound in 2018, but a USDA spokesperson told CNBC on Wednesday the agency doesn’t know when the USDA will decide to move in that direction.
The price of beef in the US rose more than 30% from the previous year to $78.30 a pound on Wednesday.
But in 2016, when the market was more robust, the USDA reported that the price of US beef was $76.60 per pound.
This year, the average price of the average beef product is expected to be $72.45 per pound, the agency said.