There is a strong seasonality to the wholesale prices of certain cuts of beef and pork, and these seasonals are playing out currently.
As temperatures warm in the spring, a growing number of consumers like to grill the protein portion of some of their meals. Certain cuts lend themselves well to this type of cooking, and it’s these cuts that are helping to support the average beef and pork carcass value.
RIBS, STEAKS
For beef, the cuts currently in favor with the public are ribeyes, loins and ground beef. Wholesale prices for each of these are rising, but could top out within the next few weeks.
Prices listed by the USDA’s National Agricultural Statistics Service for boneless, light beef ribeyes last week averaged $854.43 per cwt, compared with $853.23 the previous week. This price also was up from $788.26 in the same week a year earlier and up from the 2013-2017 average of $720.74.
More importantly for this discussion, weekly wholesale ribeye prices have been rising unevenly since the beginning of the year. Any dips in the upward trend in prices have come on schedule but have been much less pronounced than they were last year or in the previous five-year average.
Nonetheless, wholesale prices for ribeyes should top out by mid-to late May. Last year, they topped at $877.77 per cwt in the third week of May, and the 2013-2017 average has them topping at $824.72 in the last week of May.
In the same manner, weekly average prices for boneless wholesale beef loin strips are shooting high after the seasonal buying period began the fourth week of February. And, a seasonal early April price dip only showed up as a minor slowing of the weekly price gains.
And, as with ribeyes, prices for strip loins should top out around the last week of May, although last year, the peak waited until the second week of June to appear. The average weekly price peak for the 2013-2017 period was $802.78 per cwt, and the same peak last year was $863.30.
BONELESS BEEF
Wholesale prices for boneless beef also are rising. Prices for these products, commonly associated with ground beef, have a seasonal tendency to rise in the spring, flatten or decline in the summer and decline further in the fall.
However, there are some differences.
Prices for 90% lean product are much less volatile than those containing only 50% lean. The two products typically are blended to formulate the various leanness qualities seen in the grocery store.
Prices for the fattier product rise unevenly from about the last week in February to a mid-March top before falling away to an early April low, which sets the stage for a rise to the annual peak the third week of May.
Wholesale prices for 90% lean boneless beef peak about the last week of August in a much more rounded curve.
CATTLE, BEEF RECAP
Cash cattle trading last week in the Plains was reported at $126 to $127 per cwt on a live basis, steady to down $1 from the previous week. Dressed-basis trading was reported at $205, down $2 to $3.
The USDA choice cutout Monday was up $0.15 per cwt at $233.14, while select was off $1.69 at $217.72. The choice/select spread widened to $15.42 from $13.58 with 67 loads of fabricated product sold into the spot market.
There were no tenders Monday for deliveries against the Apr futures contract.
The CME Feeder Cattle index for the seven days ended Thursday, was $145.19 per cwt, up $0.95. This compares with Monday’s May contract settlement of $143.40, down $0.55.