U.S. feedlots probably bought fewer cattle last month as a Texas drought reduced the number of available animals, signaling tight beef supplies, record meat prices and higher costs for restaurants such as Sonic Corp.
Purchases probably fell 3.2% to 2.385 million head of cattle from a year earlier, according to a Bloomberg News survey of 10 analysts. In the 12 months ended Oct. 1, Texas, the leading beef producer, had the driest period since records began in 1895.
This last week, cattle futures for December delivery rose to $1.24475/lb. in Chicago, a record for the most-active contract. Sonic, a drive-in hamburger chain, says that beef was one of the “primary cost drivers” in the quarter ended Aug. 31. Ground beef jumped to $2.868/lb. in September, the highest since at least 1984.