US imported beef prices continue to ease
21 May 2018
US imported beef prices edged lower this week, despite overall spot supplies for lean grinding beef remaining limited. Overseas packers were willing to sell some lean and extra lean product to US end-users at the aforementioned lower prices, as a result of a weaker Australian dollar. Since the end of January, the Australian dollar has declined US5.9¢, currently trading at US75.2¢.
The imported 90CL beef indicator was unchanged in US$ terms, at US200¢/lb CIF (down AUD0.6¢ at AUD586.5¢/kg CIF).
Drought conditions in the Southern Plains have seen pastures and crops continue to deterioriate. In the short term, the dry weather will likely drive increased cow meat availability, however the long term implications could impact US beef production estimates over the next few years should a forced liquidaton occur. At this stage, a liquidation of the beef cow herd is yet to occur but if conditions worsen into July and August, regional de-stocking could commence.
Market highlights for the week ending 18th May:
- US cattle slaughter last week was 660,000 head, 7.8% higher than a year ago and the highest weekly slaughter since 2011.
- Imported beef prices continued to drift lower this week, widening the gap with US domestic product.
- Steiner estimates feedlot placements in April down 6.7% compared to a year ago. On feed inventory is estimated up 5.4% compared to last year.
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