Sharp reversal in US imported beef market
10 March 2016
In a poor week for the beef trade to the US, virtually all the gains made over the previous month were lost, with lean beef moving sharply lower. The imported 90CL cow beef indicator dropped 8US¢, to 196US¢/lb CIF, this week (down 37.0A¢, to 580.7A¢/kg CIF), while 95CL bull meat and 90CL shank meat also recorded large falls. Fattier trimmings were not quoted this week.
Reasons for the turnaround in performance are suggested in the Steiner Consulting Group’s weekly report for MLA, including a large spike in US domestic 50CL beef trimmings, which make up a significant portion of the ground beef formulation (the mix of lean and fat trimmings to get the desired mix for ground beef or burgers). This could be a short-term phenomenon however, and stabilise after Easter. In addition, the availability of cow beef from New Zealand appears to be starting to increase, a few weeks after a slowdown in bull meat. This tends to occur in autumn each year, and low dairy prices suggest another relatively large cow cull year.
Following the large volumes of 2015, US beef imports that have cleared customs as at 8 March were just 2% lower than the same time last year. The difference is in the composition of imports. Australia is still the largest source of beef imported into the US, but volumes are 14% lower than this time last year, while NZ shipments have jumped 22%, and are ahead of Canadian product.
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