U.S. beef packing companies are suffering the largest losses in 2-1/2 years as tight supplies of cattle have them paying near record high prices for them, Reuters reports. The losses could cause beef companies to cut back on the number of animals slaughtered, which would lead to higher retail beef prices.
"The cattle market ended last quarter with a bang. It was certainly a victory for the producer, but not for the packer whose margins are at their narrowest levels of the year," said Elaine Johnson, an analyst with CattleHedging.com.