Global futures investors are beginning to speculate on a meat commodities boom over the next few years, the other side of the see-saw that has seen grain prices rocket upward over recent months.

In the United States, where Bloomberg reports that corn prices are the highest they've been since the American Civil War of the 1860s, the grain-intensive livestock industries are culling back to constrain supply and inflate prices.

In South America, farmers are opting for grain crops over cattle.

At the same time, demand from newly-rich populations in China, India, Russia and South-East Asia is pushing demand for meat to unprecedented levels.

These conditions should present a perfect opportunity for the Australian livestock industries, particularly the export-focused beef sector.

But Meat and Livestock Australia's chief market analyst, Peter Weeks, said that after years of sustained prosperity for cattle producers, the planets have fallen out of alignment.

While the US dollar has fallen, the Australian dollar has climbed, putting placing Aussie meat in a less favourable footing in the the US, Japan and Korea, the three export markets that have powered the beef industry for the past five years.

At the same time, Korea, and very likely Japan, will fully reopen their doors to US beef in 2008, allowing US exporters to ride in on their weak dollar and quickly regain the ground they lost to Australia in the BSE scare of 2003.

Russia, South-East Asia and parts of Europe are picking up the slack, but haven't yet fully accounted for the beef trade lost on the US, Japan and Korea.

Added to high grain prices in Australia, which have pushed numbers of cattle on feed down to 51pc of capacity and supressed the feeder animal market, and Mr Weeks expects prices for certain classes of cattle to fall in 2008-2009.

"The buoyant global market is going to prevent that from being a really major fall, but it's not going to prevent it," Mr Weeks said.

"I think the price fall will be restricted to single digits this year and next year.

"Next year's fall will probably be confined largely to the finished cattle category—Jap Ox, trade cattle, cows for export to the US.

"There shouldn't be much of a price drop overall for young cattle or for cows."

* Extract from a full report in today's Rural Press agricultural newspapers.