The State Of The International Cow In 2015


If you're a true-blue American, you love nothing more than a juicy cheeseburger when you get hungry (vegetarians and communists need not read further). The demand for beef is what makes American agriculture tick, as we consume twenty-five billion pounds of beef annually in the form of Big Macs, ribeyes, beef jerky, and chili. That's a figure that's been dropping steadily over the past decade, however, not due to any less affinity for a well-cooked steak but because of shrinking wallets and farm budgets that choose economical poultry or fish instead of beef that's shooting upward in value, rising from about $3.50 a pound in 2002 to $5.50 a pound today. Where America is losing ground, however, the rest of the world is catching up. That's why the big commodity to get into for 2015 is cattle and the choice of investment is cattle exchange-traded funds. What's the lowdown on cattle ETF investments?

The Local View

When the shooting rise in beef prices, it's tempting to put your money into domestic cattle commodities. A single cow, after all, produces nearly 2000 servings of hamburger, a single feedlot may have as many as fifty thousand head of cattle, and there are about four thousand feedlots with ten-thousand head carrying capacities in the nation. You can do the math yourself, but the point is simple: the US is ground zero for cattle. Or rather, it was, prior to a perfect storm of conditions that have been steadily driving down cattle production. First and most important is the large-scale droughts affect much of the American west. Factors like climate change and polar vortexes have all been blamed on the relative scarcity of water in the west, and if there's one thing cattle need, it is water. It takes 2500 gallons of water in order to put one pound of beef on the table, providing cattle with water over the course of their long living cycle and growing the vast amount of foodstuffs they require to put on weight. Lack of water has meant a dearth of ...

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