Feedstuffs Meat Price Outlook: Jan. 8, 2019
Pork cutout only shows neutral price movement due to abbreviated harvest levels.
Jan 08, 2019
Beef: A small to moderate amount of cash cattle started trading on Thursday last week. Prices were $123/cwt. in the South and $122-123 in the North on a live basis, steady with the increases of the previous week. Some dressed trade developed in the North on Friday at a steady $195. The fed cattle market could show some modest weakening into late January. Cutout values firmed on Monday and Wednesday of last week but then dropped lower Thursday and Friday. The weekly average on the Choice cutout was firmer, while the Select cutout rose $2. Weakness in Choice ribs was overridden by strength in primal chuck, loin, brisket and flank. Cutout values may see further firming in the very near term before weakening in late January and into February. Following the sharp fall-off to 438,000 head during the week of Christmas, cattle harvest jumped up to 520,000 head this week, but that total was 25,000 head below last year.
Pork: The pork cutout certainly could have increased more this week than the tepid, neutral price movement, as this week saw abbreviated harvest levels again. Despite the tight product supplies, spot buyers were not ramping up sharply, being slow to make orders until the holiday clearance could be fully assessed. Most of the primals, save the hams, have priced in their lows and are beginning to prepare for their next movement: upward. This puts the price risk on the cutout to the upside, but a steep price risk environment is not likely. It will take some time to get price to the next seasonal peak, with a discount versus year ago required for the next two months to move the additional volume of product.