Decline in the US imported beef market

US imported beef prices continued to drift lower this week, as overseas packers lowered asking prices in order to generate bids from US end users.

The imported 90CL beef indicator fell 8US¢ from week-ago levels, to 204.67US¢/lb CIF (down 21A¢, to 566.13A¢/kg CIF).

With US end users appearing reluctant to bid on product for delivery in September and October, overseas packers opted to reduce asking prices in order secure offers. Steiner Consulting Group reported that trade developed as a result and, in some cases, prices were reduced by as much as 10US¢ cents compared to the week prior.

Imported frozen beef is reported to be trading at an 18¢ discount to that of chilled domestic product, albeit for delivery in the forthcoming weeks. Spot availability remains somewhat limited.

Retail & Foodservice

The report suggests some US foodservice operators have reported a decline in customer numbers. Steiner Consulting Group attribute this to a significantly greater number of outlets opening over the last few years, along with a reduction in brand loyalty from younger consumers and also the opportunism from retailers and other food delivery concepts successfully attracting new customers. However, foodservice operators remain somewhat optimistic that stronger demand will return moving forward, despite indications that demand is shifting towards grocery retail.

As imported beef supplies recover in 2018, Steiner anticipates imported product will once again trade at a discount to domestic product. The report suggests the shifting demand towards grocery retail could lead to stronger positioning for domestic ground beef, further supporting domestic prices.

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