Drama in the Beef Market

Drama in the Beef Market

Black Angus cattle Black Angus cattle

March 17, 2016

NASHVILLE, Tenn (RFD-TV) Uncertainty in the feed cattle market has had many beef cattlemen anxious for what the future might hold. A report from Certified Angus Beef and the American Angus Association analyzes grading trends for 2015 and their implications for cattle producers in the months ahead.

If the 2015 live cattle and beef trade could be summed up with one word, that word would be “drama.” ?Paul Dykstra from Certified Angus Beef, LLC tracks market trends on a weekly basis and reflects on last year’s beef quality and prices: “The Choice box price in 2015 was almost identical to what it was on average for 2014, but the wild swings within that range – or that create the range around that – are what we are really talking about. It's certainly more dramatic than anything we've seen in a very long time in the business.”?

Even though cattle harvest numbers were down 4.6%, heavier carcass weights meant more beef to sell. “Carcass weights have a tendency historically they increase five pounds per year if we look at data back to 1980 or so,” Dykstra continues. “Last year we saw steer weights increased 20 pounds over 2014. Again, that itself is very dramatic and had created quite a bit of the market shift that we saw late in the year.”

?As for quality in the mix: Select tonnage decreased twenty percent 20% in 2015, while Choice increased 3.5%.? Dykstra once again elaborates, “We saw the choice select spread only move from eight and a half dollars per hundredweight to seven and a half dollars per hundredweight, which is still very robust and within what I think is a very normal expectation for any year historically. So I think that’s a message back to us that even though there is less Select available, the market is not demanding Select at the same rate that it is Choice, Certified Angus Beef and Prime grade products.”

For a free, biweekly installment of Dykstra’s grading analysis, visit:
www.cabpartners.com/news/cabinsider/

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