Both wholesale beef and wholesale pork prices have declined dramatically over the past two weeks. Friday’s Choice boxed beef cutout closed at $261.48 per cwt., a 28% decline for the week and 45% lower than the peak May 12.
Similarly, the pork cutout closed Friday at $72.78 per cwt., down 17.5% from a week ago and 40% lower than the peak on May 11.
Wholesale price declines suggest most packing plants have nearly recovered from the COVID-19 virus shock of a few weeks ago.
Steiner Consulting says beef and pork packers have “implemented new procedures, devoted more resources to dealing with the virus, and they are benefitting from the fact – despite the many positive cases – most workers have been non-symptomatic.”
According to the Daily Livestock Report, during the recent COVID testing at Storm Lake IA, 591 workers tested positive but 75% those infected did not have any symptoms. Positive workers had to be quarantined for a period of time but they are now coming back.
“The result has been a notable improvement in the slaughter rate,” Steiner said. “Last week cattle slaughter was estimated at 636,000 head, the highest since the last week of March and only 4.3% lower than a year ago. We think fed cattle slaughter last week was over 500,000 head and only 5% lower than last year. The weight of steers and heifers coming through is likely 4‐5% higher so net fed beef supplies for the week were similar to a year ago.”
Hog slaughter last week was 2.452 millio head, the highest since the first week of April and 1.7% higher than a year ago. With heavier hog carcass weights, pork production for the week was 4.2% above last year.
“The increase in beef and pork supplies comes at a time when retailers are working hard to slow down the quantity demanded,” Steiner says. “You do that by reducing the number of meat protein features, raising prices and imposing limits on the umber of meat packages that a consumer can buy. There is always a lag in the price transmission from wholesale to retail given the way product is distributed and that is especially apparent today.