August 13, 2007

 

US wholesale beef, pork prices narrowly mixed last week

 

 

Wholesale meat prices were narrowly mixed last week, with beef down slightly while pork posted a modest gain despite concerns of slowed retail sales due to hot weather conditions across much of the country and tightened food budgets.

 

The US Department of Agriculture's choice beef carcass composite value finished the week at US$144.07 per hundredweight, down just US$0.54, or 0.4 percent, from US$144.61 a week ago. Select beef values fell US$1.09, or 0.8 percent, for the week.

 

The pork cutout value Friday (August 10) afternoon was reported at US$71.37, versus US$70.95 on August 3.

 

Market analysts and meat wholesalers said helping underpin meat prices are buying interest for the Labour Day holiday and expectations that retail demand will improve when temperatures return to more moderate levels. The start-up of the fall school term also is considered a supportive factor since families will be back from vacations and more meals will be prepared at home.

 

Some analysts considered the modest decline in pork prices an indication of relatively strong demand overall given the hefty slaughter pace versus a year ago for a third consecutive week. USDA's estimates for the past three weeks show an average weekly increase of nearly 100,000 head, or 5.3 percent, from the same period a year ago.

 

There are also some concerns among livestock dealers and traders that if hog marketings continue to be very large, the wholesale pork market as well as cash hog prices could falter under burdensome supply pressure. However, export sales to China are a wild card amid speculation that a significant amount of pork may be shipped there this fall.

 

Glenn Grimes and Ron Plain, agricultural economists at the University of Missouri, reported in their weekly pork outlook Friday hog price estimates for this fall and next year made by attendees at the annual meeting of the American Agricultural Economics Association. The average for barrows and gilts on a live basis for 51 to 52 percent lean hogs for the third quarter of this year was US$50.50 per hundredweight. The fourth-quarter price estimate was US$46.21, and the average of the estimates for all of 2008 was US$48.46.

 

The latest Dow Jones Newswires live hog equivalent price, which is calculated from USDA's weighted average dressed prices, was US$53.42.

  

US cattle slaughter for the week was estimated at 674,000 head, compared with 671,000 a week ago and 679,000 a year ago. Year-to-date slaughter stands at 20.675 million head, up 1.6 percent from a year ago.

 

Hog slaughter this week was estimated at 2.013 million head, up from last week's 1.985 million and 6.6 percent larger than the year-ago figure of 1.888 million. Year-to-date hog slaughter is 63.248 million head, up 2.4 percent from a year ago.

 

The USDA estimated total beef, pork and lamb production for the week at 929.1 million pounds. Last week's output was 921.0 million pounds. The year-ago output was 904.6 million pounds. Year-to-date combined meat output is 28.725 billion pounds, up 1.3 percent from last year.

 

Broiler/fryer slaughter for the week was estimated at 164.594 million head, compared with 163.741 million a week ago and 162.061 million a year ago.