Wholesale beef trimmings prices are fading but remain higher than last year, according to data from the USDA’s Agricultural Marketing Service.
90% LEAN BEEF FADING
The data, which was compiled and published by the Livestock Marketing Information Service in Denver, shows wholesale 90% lean boneless beef last week at $374.77 per cwt, down $7.19, or 1.88%, from the most recent top of $381.96 in the last week of March.
The data also showed last week’s price was up $27.99, or 8.07%, from last year’s $346.78 per cwt and up $119.69, or 46.9%, from the 2019-2023 average of $255.08.
Ninety percent lean boneless beef wholesale prices usually rise into the first week of May and then drift lower into December. There is a small bump that can be related to retail buying for grocery features for the Labor Day holiday.
Last year, however, 90% lean boneless beef topped out at $276.17 per cwt the first week of August. From there, prices faded into mid-December.
50% BEEF STRUGGLING MORE
Weekly wholesale prices for 50% lean boneless beef, while remaining higher than last year in every week this year, have fallen to a level that is lower than the previous five-year average in the last two weeks.
That’s due in part to a rapid rise in the 2019-2023 average that peaks at $148.69 per cwt in the second week of May.
This year, 90% boneless beef rose higher than $130 per cwt in mid-January and has vacillated around this number ever since.
Last year, 50% boneless beef fell away into mid-June and them shot higher to the annual high of $172.29 the second week of August.
Last week’s wholesale price for 50% lean boneless beef was $111.74 per cwt, up $33.16, or 42.2%, from $78.58 last year but down $26.15, or 19.0%, from the previous five-year average of $137.89.
CONSUMER INTEREST STRONG
It’s evident that consumer buying interest for ground beef, where 90% and 50% lean boneless beef generally goes, remains strong, a market analyst said. Normally, when consumers feel strapped, the food budget is one place where at least a little savings can be made.
Generally, consumers will cut back on quality before they shift from one meat product to another, the analyst said. And where 90% lean beef is holding at a higher price than 50%, it shows little, if any, shift by consumers to trade down.
A quick check of other beef cuts shows the same thing, the analyst said. Choice middle-meat prices, where steaks come from, are holding at higher levels than last year and the average, and some are even climbing.
CTTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $217.68 per cwt to $222.01, compared with last week’s range of $212.00 to $219.77 per cwt. FOB dressed steers, and heifers went for $336.28 per cwt to $349.28, compared with $329.37 to $346.08.
The USDA choice cutout Thursday was up $1.74 per cwt at $347.89 while select was down $0.80 at $333.20. The choice/select spread widened to $14.69 from $12.15 with 77 loads of fabricated product and 45 loads of trimmings and grinds sold into the spot market.
The USDA-listed the weighted average wholesale price for fresh 90% lean beef was $377.24 per cwt, and 50% beef was $111.29.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.16 to $1.26 a bushel over the Jul corn contract, which settled at $4.47 1/2, down $0.01 3/4.
The CME Feeder Cattle Index for the seven days ended Tuesday was $295.78 per cwt, up $2.37. This compares with Wednesday’s May contract settlement of $297.47, up $3.02.