Through last week, anyway, shoppers continued to pay up for beef, according to a weekly National Cattlemen’s Beef Association “Wholesale Price Update.”
The report is in contrast to a Thomson Reuters article this week saying shoppers in poorer neighborhoods were pulling back from the meat counter.
The published charts are prepared using data from the US Department of Agriculture Market News and the VMMeat System by Meat Solutions.
The results are somewhat foggy, but it seems clear that the last two weeks have shown a cooling of consumer buying. What isn’t clear is whether this is the beginning of a longer-term trend or just a normal setback in the pricing of some beef cuts.
CHOICE/SELECT SPREAD NARROWING
To be fair, the difference between a composite price for choice and select beef, or the choice/select spread, is narrowing, and, according to this dataset, is down from the same week last year. It also is on a sharp downward trajectory.
However, the average choice retail price and the average select retail price remain higher than the same week in 2023 and 2022.
The sharpest week-to-week trajectory decline was in the average retail price of choice beef, reported at $3.01 a pound last week, down $0.08, or 2.59%, from $3.09 a week earlier and down $0.12, or 3.83%, from this year’s high two weeks ago at $3.13.
The average select retail price last week was $2.98 a pound, down $0.03, or 1.00%, from $3.01 a week earlier and down $0.05, or 1.65%, from this year’s weekly high of $3.03 two weeks earlier.
GRINDS REMAIN MOSTLY FIRM
If the Reuters story is correct and somewhat predictive, average weekly retail prices for ground beef react, but that’s not what is being shown in the USDA data. It may be true for some neighborhoods, but it doesn’t seem to be the case for all, because the weekly average prices for several fat content blends all remain higher than last year.
For instance, the average weekly retail price for 73% lean ground trimmings was $2.24 a pound, up $0.12, or 5.66%, from $2.12 in the same week last year and up $0.45, or 25.1%, from a three-year average of $1.79.
Plus, 90% lean ground trimmings last week averaged $2.64 a pound, up $0.82, or 23.7%, from $3.46 in 2023 and up $0.58, or 18.0%, from the three-year average of $3.22.
Ground beef should be particularly good at showing emerging trends in consumer buying since it is more versatile in the kitchen than a steak or roast.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $184.93 per cwt to $190.00, compared with last week’s range of $185.94 to $195.38 per cwt. FOB dressed steers, and heifers went for $291.31 per cwt to $295.37, compared with $293.28 to $299.46.
The USDA choice cutout Tuesday was up $0.02 per cwt at $302.09 while select was down $0.37 at $299.90. The choice/select spread widened to $2.19 from $1.80 with 119 loads of fabricated product and 27 loads of trimmings and grinds sold into the spot market.
The daily weighted average USDA listed wholesale price for fresh 90% lean beef was $345.78 per cwt, and 50% beef was $98.28.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.40 to $1.50 a bushel over the May corn contract, which settled at $4.31 1/4 a bushel, down $0.04 1/4.
No live cattle contracts were tendered for delivery Tuesday.
The CME Feeder Cattle Index for the seven days ended Monday was $245.83 per cwt, down $2.79. This compares with Tuesday’s Apr contract settlement of $240.70, up $1.40.