Good News in Beef

BEEF Let’s start with some really good news. For the first time since 2018 the US cattle herd increased by 200K head to 94.2 million head, this however is not the start of beef herd building we’ve been looking for. The increases are in dairy cows, the beef herd actually declined 200K head to 28.5 million head. I do see some signs of heifer retention with ranchers reserving additional head for breeding. I’m still taking this as a good sign. Additional good news: Our southern border will open to Mexican livestock with one port opening August 24 in Arizona. This entry will probably only be about 3,000 head per week, but we will take the progress. We’ve gone a week with no new New World screw worm cases, so let's keep the momentum going. Onto the current beef market and we continue to move lower finishing July, and I’d expect the early part of August will continue the decline.  There is an exception as ribeyes and tenderloins seem to have done their summer declines; while the rest of the market softens, they have some demand behind them to keep from further declines. Declines from last week continue though they are getting smaller, and I do think we’ll see a bottom to this current market in the next couple weeks. Thin meats, rounds and chucks all moving lower, even grinds, which I almost thought invincible to market declines, are moving lower. I’d still stay ahead of your needs but as this market declines there will be opportunities.  

POULTRY Chicken market is down for next week. Boneless skinless randoms, tenders and even wings are all moving lower. This strong production we’ve seen all year seems to finally be catching up the producers lowering prices to keep things moving. I thought we’d see a minor increase but we’re going the other way. Makes chicken a great value this summer. On the avian flu beat – two weeks, no new cases. We’ll take that all day long.  

GRAINS Last week had all the grain markets moving higher, even corn. Well, that was last week. This week, except for wheat being affected by international unrest and domestic crop stress, corn and soy are moving back down. This week’s corn closed at $4.69 down from last week $4.84. Soy closed $11.71 down from $12.26 last week. Soy oil should move lower over the next couple weeks.  

PORK Pork bellies are up again this week, closing today at $159 over last week’s close of $156. While I do think we have a couple more weeks to go, I think we’ve got a week or two more before declining again heading into fall. Right now, it's all moving higher. Bellies are about the only thing pushing higher and pork, butts, ribs and loins, steady to down slightly. 

DAIRY The recent run up on the CME for the block and the barrel seems to have run out of steam. Through Thursday's close block is down 8, barrel is down 5 and butter continues lower down 11. Plenty of raw material available and we’re seeing a slowdown heading into August. 

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