Amid the cacophony of tariffs, no tariffs, less tariffs, the continuing drought, the fighting in Iran, rising inflation, employment concerns and whatever else there is, one thing remains in the cattle and beef markets – lean beef prices continue to climb.
USDA-reported wholesale prices for 90% lean beef and 50% lean beef (both of which are almost universally ground) remain on an upward seasonal path at a higher level than either last year or the 2020-2024 average as calculated by the Livestock Marketing Information Center in Denver.
90% PRICES HIGHER
Last week’s USDA average price for fresh 90% lean beef was $434.56 per cwt, up $4.36, or 1.01%, from $430.20 the previous week, up $53.13, or 13.9%, from $381.43 a year earlier and up $169.87, or 64.2%, from the previous five-year average of $264.69 per cwt.
On average, the average weekly price for fresh 90% lean beef will rise to an annual high the first week of June before beginning a gradual decline that accelerates in the last four months of the year.
Last year, however, an early rounded top peaked the last week of March and bottomed the first week of May before rising to the annual top of $435.31 in the first week of September. From there, it declined through December.
50% PRICES HIGHER
Average weekly prices for 50% lean beef make less seasonal sense than do those of 90% lean beef, with their mid-year spikes and drops. They were especially chaotic through the first five months last year while gradually trending higher.
Last week’s USDA average price for fresh 50% lean beef was $178.27 per cwt, up $18.17, or 11.3%, from $160.10 a week earlier, up $72.62, or 6.87%, from $105.65 last year and up $90.62, or 103.4%, from the previous five-year average of $87.65.
On average, the average weekly price for fresh 50% lean beef rises into an early peak the third week of January and the annual peak the second week of June. From there, it drops off for a couple of weeks before initiating a slow rise to another rounded top about the second week of August, after which, it tails off.
Last year was a mess. The average weekly price rose in January and then vacillated almost weekly through about the second week of May at $110.12 per cwt. From there, it shot up to the annual high of $261.99 per cwt the second week of July before dropping back to $179.37 the first week of August.
Then the weekly average price bounded around as it descended to a minor low the first week of October. Then, it rose to another high of $178.34 the third week of November before bouncing down through December.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $235.89 per cwt to $238.25, compared with last week’s range of $239.92 to $246.64 per cwt. FOB dressed steers and heifers went for $372.51 per cwt to $377.44, compared with $376.66 to $382.97.
The USDA choice cutout Tuesday was up $0.65 per cwt at $403.31 while select was up $2.21 at $396.72. The choice/select spread narrowed to $6.59 from $8.15 with 86 loads of fabricated product and 20 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef as $441.13 per cwt, and 50% beef was $193.01.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $0.90 to $1.05 a bushel over the May corn contract, which settled at $4.54, unchanged.
The CME Feeder Cattle Index for the seven days ended Monday was $358.31 per cwt, up $1.26. This compares with Tuesday’s Mar contract settlement of $359.80, up $4.35.