January 15, 2008

Tyson develops pricing scheme to discount meat from heavier cattle

Tyson will introduce a new cattle pricing grid, called the true value grid, to discount the prices of meat coming from animals weighing more than 1,000 pounds.

Customers have always preferred not too heavy animals, expressing concerns about excessive piece weights from heavy carcasses, the company explained.

Under the true value grid, beef carcasses weighing more than 1,000 pounds are discounted US$15 per hundredweight, while those more than 1,050 pounds are discounted US$35 per hundredweight.

The grid also incorporates USDA's regional weekly weighted average prices as well as average premiums and discounts based on quality.

Gary Mickelson of Tyson said that the company is working to make the new grid applicable in all regions within a few weeks.