Steve Meyer News
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U.S. hog producers with improved profitability will probably expand herds next year, which may test packing capacity, said Steve Meyer, president of Paragon Economics.
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U.S. hog farmers should “think twice” before expanding herds because too much supply may create a “bottleneck” in 2013 that would send prices lower, said Steve Meyer, the president of Paragon Economics.
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U.S. meat prices may rise to records this summer after farmers reduced hog and cattle herds to the smallest sizes in decades, the result of surging feed costs linked to demands for more ethanol.
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U.S. pork prices that already are the highest ever probably may rise further as hog producers pass along the increased costs of animal feed, said Steve Meyer , the president of Paragon Economics.
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Meat prices are poised to extend a 14 percent rally this year that drove U.S. retail costs to the highest levels since the 1980s as surging corn futures prevent livestock producers from expanding their herds.
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U.S. hog producers may start to cull herds as the faltering economic recovery curbs pork demand and tightening corn inventories boost livestock-feed prices, curbing animal supplies and increasing costs for meatpackers.
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Smithfield Foods Inc., owner of the world’s biggest hog slaughterhouse, is looking for deals in smoked ham, bacon and frozen meatballs. That may put Sara Lee Corp. and People’s Food Holdings Ltd. on its shopping list.
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Hog prices may climb as much as 12 percent by August as supplies of animals available to U.S. meatpackers wane, said Steve Meyer , the president of Paragon Economics in Des Moines, Iowa.
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Pork producers say U.S. consumers will pay more for the meat if the industry abandons the practice of confining sows to single stalls to appease food companies including McDonald’s Corp. demanding open pens.
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Hog futures jumped to a three-week high and cattle gained on speculation that rising corn costs will discourage U.S. producers from expanding herds, tightening supplies to meat processors.
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