November 24, 2008

US wholesale meat, chicken prices mostly flat ahead of Thanksgiving


Wholesale meat and broiler chicken prices were generally flat last week despite slowed shipments for several of the cuts ahead of the Thanksgiving holiday.


The US Department of Agriculture reported the choice beef carcass value Friday at US$156.10 per hundredweight, off US$0.92 from a week ago, but prices during the week averaged above those of a week ago. The change in the pork cutout for the week was just US$0.08 and was up. Boneless/skinless chicken breasts and leg-quarter prices Friday on a delivered basis into the northeast US were basically flat compared with a week ago.


Orders of meat cuts on the books from grocers, as well as chicken for delivery to stores late next week and into early December, are reportedly active enough to move the supplies that are available and hold prices near steady, according to market analysts and brokers. Also, all major meat and poultry processors will be closed next Thursday for the Thanksgiving holiday, so output will be reduced next week.


Some analysts predict that wholesale prices for some beef and pork cuts could move higher in early December and might show further strength as the month progresses, depending on slaughter rates and the strength of the dollar. Stronger seasonal demand for premium beef cuts to be used in the hotel and restaurant industries could help keep beef rib and loin primal values higher through at least the middle of the month. That could depend, however, on whether consumers travel as much as they normally do during the holidays and/or dine out at the mid- to higher-priced restaurants with the economy under duress.


The volume of product to be moved through export sales also could make a significance difference in domestic price direction for meat and poultry cuts. If the dollar is stronger against other currencies, export sales could be negatively affected because it would cost international buyers more to purchase the products, analysts and brokers said. A cheaper dollar against foreign currencies would make US meat and poultry more price competitive.


Glenn Grimes and Ron Plain, agricultural economists at the University of Missouri, in their weekly hog outlook report released Friday said the value of pork and pork variety meat exports for the first nine months of 2008 was US$42.17, up from US$28.07 in 2007, per hog slaughtered. The dollar was weak throughout most of that period.


Last week's cattle slaughter was estimated at 633,000 head, up from 619,000 a week ago and 584,000 for the holiday-shortened week a year ago. Year-to-date cattle slaughter is up 0.4 percent from a year ago.


Hog slaughter last week was estimated at 2.366 million head, up from 2.310 million a week ago and 2.023 million a year ago. Year-to-date slaughter is up 7.2 percent.


The USDA estimated total beef, pork and lamb production for the week at 977.9 million pounds. The previous week's output was 956.5 million pounds, and the year-ago figure was 879.9 million pounds. Year-to-date combined meat output is up 3.4 percent.


Broiler/fryer slaughter this week was estimated at 155.897 million head, compared with 159.887 million a week ago and 129.511 million a year ago.

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