October 20, 2008
US wholesale meat prices extend slide, beef off 3.5 percent, pork 5 percent
US wholesale prices for beef and pork extended their declines this week as the categories slipped about 3.5 percent and 5.2 percent, respectively, from a week ago.
Choice beef fared slightly better than did select, regarding the amount of value in dollars per hundredweight and in percentage loss. The US Department of Agriculture reported the choice grade beef carcass value Friday afternoon at US$144.49 per hundredweight, down US$5.02 from a week ago. The select beef quote at week's end was US$137.49, off US$5.75 from last Friday.
Wholesale pork prices closed the week at US$65.02, compared with US$68.58 last Friday. On Wednesday, the carcass composite value fell to $64.11, the lowest since April 11, before bouncing back Thursday.
Market analysts and commodity brokers said uncertainty and concerns about the economic crisis continue to hamper consumer spending while limiting buying interest among grocers and food-service operations.
Economic problems elsewhere in the world and anecdotal reports of delays or cancelled orders in the export markets also weigh on livestock and meat prices. Pork exports for the year through the end of August were up 71 percent from a year ago by volume and 64 percent higher in value. The increase in volume for the eight months amounted to about 569,000 metric tonnes, or about 1.25 billion pounds of additional pork taken off the domestic market.
The surge in pork exports helped keep domestic supplies in check, despite an increase in production of about 8 percent so far this year, analysts said.
The next few weeks could be critical for livestock producers and meat packers. Hog slaughter and pork production are nearing their seasonal peaks, and export sales need to remain brisk to keep the domestic market from becoming overladen with meat, analysts and brokers said.
Beef packers responded to the declines in wholesale prices by trimming production this week. Cattle slaughter this week was down 27,000 head from a week ago and 49,000 below a year ago.
Last week's cattle slaughter was estimated at 628,000 head, compared with 655,000 a week ago and 677,000 a year ago. Year-to-date cattle slaughter is up 0.6 percent from a year ago.
Hog slaughter for the week was estimated at 2.348 million, compared with 2.375 million last week and 2.330 million a year ago. The year-to-date hog slaughter is up 7.8 percent.
The USDA estimated total beef, pork and lamb production for the week at 969.8 million pounds. Previous week's output was 994.2 million pounds, and the year-ago figure was 1.012 billion. Year-to-date combined meat output is up 3.9 percent.
Broiler/fryer slaughter last week was estimated at 162.035 million head, compared with 163.786 million a week ago and 169.642 million a year ago.