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Choice Beef Sets 15 Record Highs In 20 Months
The average retail price of choice beef during May in grocery stores was a record $6.412 per pound. That is up 1 cent from the old record set the month before and up 49.9 cents from May 2014. Choice beef prices have set 15 records in the last 20 months.
The Consumer Price Index for May was higher for the fourth consecutive month, but is still a slight 0.04 percent below 12 months earlier. The “core” rate, excluding food and energy, was 1.7 percent higher this May than last.
The average price of slaughter steers was $161.50/cwt in May. That is the same as the month before and 9.5 cents below the record set in November 2014.
Through mid June beef packer margins are equal to last year. They are above the extremely low levels of 2012 and 2013 which caused plant closings, but not nearly high enough to induce expansion.
USDA’s weekly Crop Progress report says 73 percent and 67 percent respectively of corn and soybean acres were in good or excellent condition on June 14. Both numbers are slightly lower than on the same date last year.
Fed cattle prices this week were lower on light volume. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $151.29/cwt, down $3.57 from last week’s average, but up $2.25 from a year ago. The 5 area average dressed price this week for steers was $240.20/cwt, down $4.99 for the week, but up $3.26 compared to the same week last year.
This morning the choice boxed beef cutout value was $250.84/cwt, up $3.70 from the previous Friday and up $10.03 from a year ago. The select carcass cutout was $245.79/cwt this morning up $4.49 from last week and up $12.51 from a year ago.
Cattle slaughter this week totaled 549,000 head, up 1.3 percent from the week before and down 10.6 percent from the same week last year.
The average steer dressed weight for the week ending on June 6 was 866 pounds, up 2 pounds from the week before, up 16 pounds compared to the same week last year and above the year-ago level for the 51st consecutive week.
Feeder cattle prices at Oklahoma City were mixed this week. Prices for medium and large frame #1 steers by weight group were: 400-450# $315-$323, 450-500# $284-$323, 500-550# $273-$287, 550-600# $240-$271, 600-650# $229-$260, 650-700# $225-$256, 700-750# $224-$239, 750-800# $221.50-$229, 800-900# $192-$227.50 and 900-1000#, $192-$213/cwt.
Fed cattle futures were little changed this week this week. The June live cattle futures contract settled at $151.90/cwt today, down 55 cents for the week. August fed cattle settled at $150.67/cwt, down 13 cents from the previous week. October fed cattle gained 5 cents this week to settle at $153.25/cwt.
The August feeder cattle contract ended the week at $223.42/cwt, down 3 cents for the week. ∆
DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri
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