In the fall, summer grilling demand gives way to stronger demand for roasts, crock pot cooking and increased middle meat demand in restaurants, said Derrell Peel, Oklahoma State University Extension livestock marketing specialist, in a letter called Cow-Calf Corner.
Wholesale ground beef prices have moderated recently as hamburger grilling demand slows but prices remain well above year-ago levels, Peel said. Total beef production is down a scant 0.7% so far this year and may end the year equal to year-ago levels. Despite this, wholesale and retail beef prices are higher thus far in 2024.
BOXED BEEF PRICES UP
As of Oct. 18, the daily choice boxed beef price was $320.65 per cwt, up from a low of $296.37 on Sep. 26 and the highest price since July 15, he said. The weekly choice boxed beef price is also at the highest level since July and has averaged 2.2% higher year over year and a record high for the year-to-date.
Numerous wholesale cuts moved higher recently including chuck arm roast, chuck roll, chuck mock tender and chuck flap, Peel said. Wholesale round cuts also have moved higher including round knuckle, top inside round, bottom (gooseneck) round, outside round and eye of round.
Middle meat prices from the loin and rib also have increased including bottom sirloin flap, sirloin tri-tip, loin strip and tenderloin, he said. Likewise, wholesale ribeye prices have increased recently and are showing an early seasonal demand for the holidays.
STEER KILL UNCHANGED
Thus far in 2024, steer slaughter is unchanged from 2023, Peel said. Heifer slaughter is down 1.6%.
Total fed slaughter is down 0.7% compared with last year, less than earlier expected, he said. For the year to date, steer carcasses have averaged 25.5 pounds heavier than last year, and heifer carcasses are averaging 22.6 pounds heavier than one year ago.
The result of stronger-than-expected fed slaughter and heavier carcass weights has been an increase in fed beef production of 1.9% thus far in 2024, Peel said. In fact, for the last 16 weeks, fed beef production has been 3.7% larger.
The increase in boxed beef prices is perhaps even more surprising in the face of increased fed beef production, he said. Higher prices and increased quantities suggest beef demand remains very robust.
In contrast, non-fed beef production is sharply lower this year, down 12.8%, Peel said. Total cow slaughter is down 15.3%, consisting of a 13.8% decrease in dairy cow slaughter and a 16.8% decrease in beef cow slaughter.
CATTLE, BEEF RECAP
The USDA reported formula and contract base prices for live FOB steers and heifers this week ranged from $189.82 per cwt to $194.78, compared with last week’s range of $187.95 to $194.48 per cwt. FOB dressed steers, and heifers went for $294.97 per cwt to $300.81, compared with $293.66 to $298.77.
The USDA choice cutout Thursday was down $1.84 per cwt at $317.60 while select was down $3.95 at $285.37. The choice/select spread widened to $32.23 from $30.12 with 113 loads of fabricated product and 26 loads of trimmings and grinds sold into the spot market.
The USDA-listed weighted average wholesale price for fresh 90% lean beef was $345.50 per cwt, and 50% beef was $71.18.
The USDA said basis bids for corn from feeders in the Southern Plains were unchanged at $1.26 to $1.45 a bushel over the Dec corn contract and unchanged in Kansas at $0.25 over Dec, which settled at $4.10 3/4 a bushel, down $0.00 3/4.
No cattle contracts were tendered for delivery Thursday against the Oct contract.
The CME Feeder Cattle Index for the seven days ended Wednesday was $251.20 per cwt, up $1.14. This compares with Thursday’s Oct contract settlement of $251.97, up $1.02 and Nov’s $245.37, down $0.12.