Cattle Outlook: Retail Beef Prices Remain High
US - Retail beef prices were record high in February for the second month in a row. The average price of choice beef in grocery stores was $4.618 per pound, writes Ron Plain from the University of Missouri.
21 March 2011
3 minute read
Ron Plain
That was up 7.5 cents from the month before and up 41.4 cents from February 2010. The farmer’s share of the consumer’s beef dollar was 49.1 per cent, the highest since April 2007. The futures market is forecasting a record year for cattle prices. That will only occur if we keep setting records on retail beef prices.
The destruction caused by the earthquake and tsunami in Japan was the big market movers this week. Japan is the third largest foreign buyer of U.S. beef after Mexico and Canada. Last year, 1.3 per cent of U.S. beef production was exported to Japan. Both livestock and grain futures were sharply lower at the start of the week. Corn futures recovered their loss later in the week, cattle futures did not.
The April fed cattle futures contract ended the week at $111.65/cwt, down $5.47 from a week ago. The June contracted closed out the week down $5.15 from seven days earlier at $111.80/cwt. August ended the week at $114.15/cwt.
Fed cattle prices dropped back from last week’s record high to be only the second highest week ever. The 5-area daily weighted average price for slaughter steers sold through Thursday of this week on a live weight basis was $114.29/cwt, down $3.63 from last week’s record. Steers sold on a dressed weight basis this week averaged $184.78/cwt, $4.55 lower than the week before. This week last year, slaughter steer prices averaged $94.25/cwt live and $151.83/cwt dressed.
The boxed beef cutout value set a new record high this week. On Friday morning the choice boxed beef carcass cutout value was $187.01/cwt, up $6.18 for the week. The select cutout was up $6.17/cwt from the previous Friday to $185.87 per hundred pounds of carcass weight.
This week’s cattle slaughter totaled 618,000 head, down 3.0 per cent from the week before and down 0.3 per cent compared to the same week last year. Steer carcass weights averaged 829 pounds during the week ending March 5. That was down 1 pound from the week before but 4 pounds heavier than a year ago.
Cash bids for feeder cattle around the country this week were mostly $2 lower to $5 higher. Oklahoma City prices were steady to $3 higher than the previous week. The price ranges for medium and large frame #1 steers were: 400-450# $161-$171, 450-500# $160.50-$167.50, 500-550# $155.75-$160, 550-600# $151-$159.75, 600-650# $146.50-$153.25, 650-700# $138-$147.50, 700-750# $127-$135, 750-800# $125.25-$132.35, 800-900# $118-$125.50, and 900-1000# $117.25-$119.75/cwt.
The number of cattle on feed at the start of March was up 5.0 per cent compared to a year ago. Placements of cattle into feed yards during March were down 0.6 per cent and marketings were up 4.5 per cent. These numbers are close to trade forecasts.
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