As the grilling season heats up, wholesale beef prices are sending mixed signals about what is going on those grills.
Beef’s role as a lead grilling product seems secure for now, especially with bird flu necessitating the euthanasia of millions of chickens and turkeys. But prices for competing grilling items continue to rise, suggesting some spillover demand.
The most common item to cook on the grill is hamburger. This product varies in fat content and usually is made by blending 50% and 90% lean beef.
Weekly wholesale prices for fresh 90% lean boneless beef are record high for this time of year and have been running at or just below $3.00 a pound since July of last year.
Wholesale prices for 90% trimmings are so high and so stable, in fact, that demand for lean, finely textured beef, once known in the media as “pink slime,” is rising. Some stores are choosing to use it again with labeling, even though labels saying beef has been added to beef seems odd and unnecessary.
However, the 50% trimmings are having a harder time. As cows are being kept at home for a few more calves to rebuild the US herd and cattle are being fed longer and larger to overcome some of the losses feedlots are incurring, a larger percentage of the total cattle slaughter is fat, resulting in more, fattier trimmings. Prices, therefore, are more variable.
Prices for 50% trimmings this year are quite variable, as a Livestock Marketing Information Center graph shows. The graph also shows that prices for 50% trimmings this year have not followed seasonal or year-ago trends since early February. Last year, prices tended to follow the seasonals, although at a higher, more exaggerated level.
PORK SPARERIBS SHOW NORMAL PATTERN
Prices for pork spareribs this year are following the average, although at higher levels – levels that are more similar to last year. Rather than a simple back yard grill, these items are destined to be used more by restaurants or those with a higher level of charcoal skill.
Sparerib prices likely will reach an annual peak in late June or early July.
Pork loin prices are running below last year and the previous five-year average but are showing some seasonal bounce. Chops sometimes find their way to a grill, but are not extremely popular.
CHICKEN BREAST PRICES RISING SEASONALLY
Chicken breast prices are rising seasonally and are above the norm, although below last year. This is a popular grilling item along with hamburger and steaks, and with bird flu taking out so many chickens and strong beef prices, it’s possible prices will rise above last year’s $202.02 per cwt, set the first week of July.
Leg quarter prices, which are more closely associated with export market, are down, showing the effects of a stronger US Dollar this year and import bans because of bird flu. These items usually show a grilling-season influence with prices rising into May, and it may be that this will inspire more use of this otherwise exported item at home.
CASH CATTLE QUIET
Cash cattle markets Tuesday remained quiet with no packer bids. Offers were around $163 per cwt on a live basis and $263 dressed. Last week cattle traded at mostly $160 live basis and mostly $255 dressed.
The USDA’s beef cutout value was lower after a higher midday print. The choice cutout was $255.56 per cwt, up $0.08 and select at $243.60, up $0.30. Volume was active, with 119 loads of fabricated product sold into the spot market.
The CME Feeder Cattle Index for the seven days ended Monday was $216.03 per cwt, up $0.26.