Total red meat supplies as of Aug. 1 in US freezers were up 3% from July but were down 2% from last year, the USDA’s National Agricultural Statistics Service said in its monthly Cold Storage report Monday.
Total pounds of beef in cold storage were up 3% from July and up 2% from last year while total pounds of pork on ice were up 2% from July but down 5% from a year ago.
Meanwhile, total poultry supplies were up 2% from July and up 7% from a year ago as chicken stocks rose 1% month-on-month and up 7% from last year. Total turkey supplies were up 5% from last month and up 7% from a year earlier.
BEEF SUPPLIES TAKE UNSEASONAL TURN
Not only are beef supplies up from a month ago, they are up from a year earlier, and they took an unseasonal increase in July. NASS data compiled by the Livestock Marketing Information Center show the turn higher when the 2010-2014 average shows a continued decline.
Total beef on ice amounted to 469.253 million pounds up 18.02 million, or 3.99%, from 451.233 million a month earlier. This increase goes against the month-over-month decline seen last year and in the previous five-year average. Last year, June-to-July inventories fell 14.181 million pounds, or 2.99%, to 460.093 million pounds from 474.274 million.
At the same time, the 2010-2014 average inventories declined 3.908 million pounds, or 0.92%, to 419.119 million from 423.027 million.
It’s unclear, however, just how the upturn in beef supplies will be viewed by packers and meat industry investors. The larger stocks are being compared with last year and the 2010-2014 average while “normal,” when charted with a larger number of years to take in more of the cattle cycle, likely is much higher.
PORK STOCKS ALSO TURN HIGHER
Total pork inventories also bumped higher in July, but the significance of the increase isn’t apparent until the numbers are graphed.
Pork supplies rose 14.948 million pounds, or 2.40%, in July to 599.932 million from 585.884 million in June. This is important, because July supplies declined last year and fell in the five-year average.
Last year, frozen stocks of pork went down 1.311 million pounds, or 0.21%, to 633.214 million from 634.525 million in June. And the 2010-2014 average loss was 26.271 million pounds, or 5.05%, to 494.416 million from 520.687 million.
However, traders may see July’s pork storage increase as simply a variation on a theme. Pork stocks usually turn higher in August and have a secondary peak in September. The July increase may be traded as if it were August’s upturn – just a month early.
CHICKEN STOCKS SLIGHTLY HIGHER
Total pounds of chicken in cold storage rose slightly in July to begin August at 819.150 million pounds, up 4.352 million, or 0.53%, from 814.798 million a month earlier.
A year ago, stocks were at 766.242 million pounds, up 41.767 million, or 5.77%, from 724.475 million.
CASH CATTLE MARKETS QUIET
Cash cattle markets remained untraded Tuesday with bids of $115 per cwt on a live basis and asking prices at $120. Cattle traded last week at $118 live and $185 to $187 on a dressed basis.
The USDA’s choice cutout Tuesday was $0.75 per cwt lower at $200.39, while select was off $0.21 at $193.66. The choice/select spread narrowed to $6.73 from $7.27 with 99 loads of fabricated product sold into the spot market.
The CME Feeder Cattle Index for the seven days ended Monday was $147.84 per cwt, down $0.50. This compares with the Aug settlement Tuesday of $146.45, down $0.57.