US imported beef prices trading higher
19 February 2018
US imported beef prices edged higher this week, the result of ongoing supply constraints and higher asking prices from overseas packers. Given the advancing prices, US end users opted to sit on the sidelines, with limited trading undertaken throughout the week.
The imported 90CL beef indicator moved 2US¢ higher from the previous week, to 215.5US¢/lb CIF (up 1A¢, to 601.96A¢/kg CIF).
CME fed cattle futures jumped this week as market participants were encouraged by higher cash prices. In addition, the lift was also attributed to the prospective view that US packers are short of product in the short term.
Ground beef retail features have been tracking lower year-on-year over the past two weeks, with the expectations for this to increase heading into the spring, as is seasonally the case. However, some market participants report that higher fed cattle future prices could affect retail beef promotions in March and April.
Highlights from the week ending 16th February:
- Fed cattle placements in the Southern Plains may be higher than many expect, causing the on feed supply as of February 1 to be as much as 7.5% higher than a year ago.
- Fed cattle slaughter at 463,000 head was estimated 2.1% above last year while non-fed slaughter at 127,000 head was 3.1% higher
- US fast food operators are looking to use more fresh lean beef, this could make for a more volatile and higher prices in the spring when retail promotions tend to increase
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