Cattle Outlook: Choice Beef Values at Record Highs25 February 2013
US - Average choice beef retail values broke records this week as tight supplies dominate the market picture, according to Ron Plain and Scott Brown.
The average price of choice beef at retail during January was $5.244 per pound, a new record. This was up 12.6 cents from December, up 15.1 cents from January 2012, and up 9.2 cents from the November 2012 record. All fresh beef in grocery stores averaged $4.916 per pound during January, also a record.
These retail price records are most encouraging. Beef supplies are tight and will get tighter. There has been concern that consumers may abandon beef for cheaper meats if retail beef prices continue to rise.
Despite strong January retail beef prices, the boxed beef cutout value has been soft lately. On Friday morning, the choice boxed beef carcass cutout was $182.74/cwt, down 9 cents from last Friday and down $14.52 from a year ago. The select carcass cutout was $180.53/cwt, down 18 cents for the week and down $12.88 year-over-year.
The 5 area average price for slaughter steers in January was $124.70/cwt. That is down 80 cents from December’s average, down $2.10 from the March 2012 record, but up $1.60 from a year earlier.
Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $122.76/cwt, down 5 cents from last week and down $3.71 from the same week last year. On a dressed weight basis, steers averaged $195.58/cwt this week, down 28 cents from the week before and down $5.56 from a year ago.
This week's cattle slaughter totaled 573,000 head, down 3.9 per cent from the week before and down 2.4 per cent from the same week last year. The average steer dressed weight for the week ending on February 9 was 868 pounds, down 4 pounds from the week before, but up 13 pounds from a year ago. This was the 57th consecutive week with steer weights above the year-earlier level.
It appears the dairy herd and the beef herd may be headed in opposite directions. Average daily dairy cow slaughter has been above the year-earlier level for each of the last 11 months. Daily beef cow slaughter has been below the year-earlier level for each of the last 12 months.
Feeder cattle prices at this week’s Oklahoma City auction ranged from $2 lower to $4 higher than last week. The price ranges for medium and large frame #1 steers were: 400-450# $185.50-$208, 450-500# $182-$192, 500-550# $179-$186.50, 550-600# $164-$180, 600-650# $146-$166.50, 650-700# $146.50-$157, 700-750# $139.50-$147, 750-800# $138-$144.50, 800-900# $133.50-$140, and 900-1000# $125-$131.75/cwt.
The February fed cattle futures contract ended the week at $126.35, down 15 cents from the week before. The April contract lost $2.23 this week to settle at $128.22 on Friday. June fed cattle ended the week at $124.47/cwt. August settled at $125.35.
March feeder cattle futures ended the week $2.12 lower at $1414.2/cwt. April feeders closed out the week at $143.77, down $2.85 from the previous Friday.
TheMeatSite News Desk