Beef Cattle Browsing - April 2014

Beef Cattle Browsing – April 2014

Editor: Dr. Stephen Hammack, Professor & Extension Beef Cattle Specialist Emeritus
Beef Cattle Browsing

• Archives

Beef Cattle Browsing is an electronic newsletter published by Texas A&M AgriLife Extension, Department of Animal Science at Texas A&M University. This newsletter is a free service and is available to anyone interested in beef cattle.
THE  bST  SCARE  -  20 YEARS  AND  STILL  GOING

Early research established the recombinant bovine somatotropin, commonly called bST, increased milk production in dairy cows and it was approved for commercial use in the U. S. From the start, some consumer groups expressed fears about supposed effects of bST on human health. In 1993 the United Nations Food and Agriculture Organization/World Health Organization Joint Committee on Food Safety found no evidence of adverse health effects even at exaggerated dose levels. This was re-affirmed in 1998. Even so, some countries, including Canada and the European Union, do not allow use of bST.
After 20 years of commercial use in the U. S. on over 35 million cows, additional research and field observations have shown use of bST 1) has not increased human exposure to milk antibiotic residues, 2) has not affected expression of retroviruses in cattle, 3) and does not increase risk of Type I and Type II diabetes in children and adults consuming dairy products. However, many consumers still avoid milk products produced with bST and the UNFAO/WHO committee plans to reevaluate bST. It seems there is sometimes never enough science, or practical experience, to counteract human emotion.
(J. Animal Sci. 92:1800; Univ. of Arizona, Cornell Univ.)
A  GENETIC  SILVER  BULLET  FOR  REPRODUCTION ?
Prior research had identified a possible genetic source of variation in reproduction. In short, the effect was a specific genetic deletion on a particular chromosome. Researchers evaluated two populations of cattle for evidence of this deletion: 1) Bos taurus of various breed background in central Nebraska and 2) Bos taurus-Bos indicus cattle in central Florida. No evidence of the deletion was found in the Bos taurus samples. In cows open two successive years in the Bos taurus-Bos indicus group, frequency of the deletion was 7%. The researchers concluded that, in cattle of some Bos indicus influence, the particular genetic location may provide opportunity to be used for selection of cattle for improved female fertility.
(J. Animal Sci. 92:1378; USDA-ARS Clay Center, NB, Colorado St. Univ.)
EFFECT  OF  SIZE  ON  HEIFER  GROWTH  AND  REPRODUCTION
Size can be stated as either body weight or skeletal dimension. A commonly used system of skeletal dimension is frame score, determined by height at the hooks. Two spring-calving cow herds were available for study. One herd historically averaged 1220 lb mature weight; the other averaged 1470 lb mature weight. Heifers in this study from those herds averaged frame score 3.50 and 5.56 respectively. (Based on the historical mature weights, a frame score equaled about 120 lb per frame score, similar to that found in other research.) Heifers were grazed on dormant range from mid-October to mid-May, on growing pasture to early July, and placed in drylot to late September. Heifers were bred during the last 50 days of the drylot period.
Small-frame heifers gained more during the first period, and large-frame gained more during the second and third periods. Overall, large-frame gained 40 lb more (18%). At the start of breeding, small-frame averaged 705 lb (58% of mature weight) and large-frame 841 lb (57% of mature weight). Overall conception rate was 86% for small-frame and 84% for large frame, not statistically different. In drylot, small-frame consumed 20% less feed and development cost was 16% lower. Feed efficiency and cost/lb gain did not differ. Large-frame cost a total of $21.94 more feed in drylot (16% more). The authors noted that, as in some previous research, acceptable breeding performance can be realized by developing heifers to 55-60% of projected mature weight, as opposed to 60-65% previously recommended, with accompanying reduced cost.
NOTE: Based on projected mature weights in this study, for every 100 small-frame cows only 87 large-frame cows could be maintained on the same nutritional resource.
(2012 N. Dakota St. Univ. Beef Report, p.9)
SHOULD  GREATER  MATURITY  REQUIRE  MORE  MARBLING ?
For purposes of grading for quality, the USDA standards include evaluation of maturity. Maturity is based on visual evaluation of bone, cartilage, and muscle characteristics, so it is an estimate of physiological rather than chronological maturity. A-maturity carcasses are thought to be from animals 9-30 months of age, B-maturity from 30-42 months, C-maturity 42-72 months, D-maturity 72-96 months, and E-maturity >96 months. For some purposes, including eligibility for export to some countries, maturity is evaluated by dental characteristics. In most of those applications, 30 months of age is the maximum allowed for export (in an effort to eliminate possibility of BSE, which is rarely found in younger animals). Select grade carcasses must be A-maturity. Choice and Prime grade carcasses can be B-maturity but only with a higher degree of marbling.
A study was conducted to compare maturity with beef desirability. Carcasses were included only from cattle evaluated by dentition before slaughter as being < 30 months of age. A group of 300 carcasses meeting that pre-slaughter requirement was then classified by traditional carcass maturity factors as being either A or B-C; equal numbers in both maturity categories had Slight, Small, or Modest marbling (Select, Low Choice, and Mid-Choice for A-maturity). Strip loin steaks were aged 14 days and then evaluated.
There were no statistically significant differences between the A and B-C groups in mechanical tenderness or taste-panel tenderness, juiciness, or flavor. As marbling increased, quality measurements increased. The authors concluded that “when applied to grain-finished cattle whose dental ages are less than 30 months, USDA quality grades would be no less effective in identifying eating quality differences if the A and B-C maturity groups were combined and quality grades assigned using only marbling”. That is, in grain-fed cattle sorted by dentition, higher marbling should not be required for a given grade. But any such change would require revision of the USDA standards.
(J. Animal Sci. 92:1792; Colorado St. Univ.)
INCREASING  CONSUMPTION  OF  BEEF
A survey funded by Beef Checkoff of over 3000 consumers examined possible ways to increase beef consumption. For all of the following, 23% to 31% of consumers indicated they would “definitely increase” buying and 34% to 45% would “probably increase” buying if they knew:

• 4 oz of beef has the same cholesterol as 4 oz of skinned chicken breast,
• beef is an excellent or good source of 10 essential nutrients,
• lean beef helps maintain healthy weight, builds muscle, and fuels physical activity,
• lean beef fits as well as chicken or fish for heart health,
• most popular steaks have <10% fat after being cooked and trimmed,
• U. S. testing prevents beef being sold that has added hormones remaining,
• most beef cattle spend most of their life grazing on pastures on farms and ranches, and if they saw:
• greater availability of large-quantity packs with lower price per pound,
• greater availability of trimmed 4-5 oz. steaks with < 200 calories in large packs,
• greater availability of trimmed, economically priced 4-5 oz. steaks in restaurants.

(National Cattlemen’s Beef Association)
GENETIC  RELATIONSHIP  OF PERFORMANCE  TRAITS  AND  REPRODUCTION
Records from 156,506 Bos taurus, mostly crossbred females were used to assess genetics of reproduction and its relationship to performance. Reproductive traits studied were age at first calving, calving within first 42 days, interval between consecutive calvings, and survival to next lactation. Performance traits studied were dystocia, linear type traits (describing skeletal, muscular, and functional characteristics of an animal), live weight and price, carcass traits, and subjectively scored weaning quality and docility.
Heritability of age at first calving was 0.31, but was only 0.01 to 0.06 for the other reproductive traits.  Genetic correlations between reproductive traits indicated:

• heifers younger at first calving calve later, but thereafter as cows calve earlier,
• females younger at first calving have shorter lifetime calving intervals but also leave the herd earlier (have lower survival),
• heifers calving earlier continue calving earlier as cows and have shorter calving intervals, but with little effect on survival,
• cows calving earlier have shorter calving intervals and longer survival,
• females with longer calving intervals have shorter survival in the herd.

Reproduction was generally lowly correlated with performance traits, except that heavier, more muscular cows had reduced performance for some reproductive traits. The authors concluded that “breeding goals for muscularity and live weight or growth rate should be cognizant of indirect response to selection that may cause any deterioration in reproductive performance”.
(J. Animal Sci. 92:1412; Animal & Grassland Research Center at Cork, Ireland and Irish Cattle Breeding Federation at Cork, Ireland)
WHAT  IS  THE  OPTIMAL  YIELD  GRADE ?
Carcasses with superior (numerically lower) Yield Grade have higher value when sold on a carcass value grid. But Yield Grade is only one of the factors determining carcass value. A recent report analyzed carcass data collected in calendar year 2013 by a major high-quality beef company. Carcasses from a natural program or that had received zilpaterol were excluded. Averages were calculated for the five Yield Grades:

• carcass weight increased from 830 lb for YG1 to 935 lb for YG2,
• fat cover increased from 0.26 in for YG1 to 0.98 in for YG5,
• ribeye area decreased from 16.2 sq in for YG1 to 11.8 sq in for YG5,
• carcasses discounted for excess weight increased from 3% for YG1 to 23% for YG5,
• Quality Grade increased from high Select for YG1 to mid-Choice for YG5,
• Choice-Prime combined increased from 34% for YG1 to 95% for YG5,
• Prime increased from 0.2% for YG1 to 15% for YG5,

Carcass price/cwt and total $/carcass were:

• YG1 $193.75 and $1609,
• YG2 $197.94 and $1684,
• YG3 $201.04 and $1762,
• YG4 $196.98 and $1783,
• YG5 $189.45 and $1770.

The report concluded that YG3 was optimum.  NOTE: While YG4 and YG5 had slightly higher total $ return, these cattle were fatter so they would probably have been less feed efficient late in the finishing period and/or fed longer, thus increasing cost and reducing their net return.)
(U. S. Premium Beef, LLC; from USPB News 16:1, 1/17/14)
ANIMAL  FEED  VS.  HUMAN  FOOD
The debate continues as to whether feed for livestock competes for human food, and is inefficient and wasteful. A recent report found that

• global animal agriculture provides a wide array of safe, affordable, and nutrient-dense food products and useful by-products,
• livestock are important not only in developed countries but also in developing countries, where draft power from livestock is important,
• much of the earth’s land surface is not capable of producing crops for human food but can be effectively and sustainably used by livestock,
• livestock can effectively and economically use by-products from production of human food and fiber that would otherwise not be well utilized,
• improved communication is needed between producers and consumers for a better understanding of the economic, environmental, nutritional, and social benefits from animal agriculture.

(Council for Agricultural Science and Technology Issue Paper No. 53, Sept, 2013)

Can beer make grilled meats healthier? John Maday, Managing Editor, Drovers CattleNetwork | Updated: 03/27/2014

Savvy cooks often use beer in cooking, and the right brew served on the side can compliment many a fine dish. But now, researchers report that marinating meat in beer prior to grilling could reduce the formation of substances suspected to be harmful.
Grilling meats at high temperatures creates substances known as polycyclic aromatic hydrocarbons (PAHs) which in some studies have been associated with increased risk for colorectal cancer.
Researchers from Portugal and Spain conducted experiments using beer as a marinade and measuring PAHs after grilling. Results of their tests are published in the Journal of Agricultural and Food Chemistry.
The researchers marinated pork for four hours in Pilsner beer, non-alcoholic Pilsner beer or black beer, and then grilled the samples to well-done on a charcoal grill.
According to the research report, black beer showed the highest inhibitory effect, reducing the formation of PAH by 53 percent, followed by non-alcoholic Pilsner beer at 25 percent reduction (finally, a use for non-alcoholic beer). Regular Pilsner beer provided a reduction of 13 percent. The researchers concluded that using beer marinades, particular dark beer, could provide a suitable mitigation strategy for PAHs in grilled meats.
Read more from the Journal of Agricultural and Food Chemistry.

Beef Cattle Browsing - March 2014

Beef Cattle Browsing – March 2014

Editor: Dr. Stephen Hammack, Professor & Extension Beef Cattle Specialist Emeritus
Beef Cattle Browsing

• Archives

Beef Cattle Browsing is an electronic newsletter published by Texas A&M AgriLife Extension, Department of Animal Science at Texas A&M University. This newsletter is a free service and is available to anyone interested in beef cattle. 

WHAT  IS  IMPORTANT  TO  CONSUMERS ?
A survey was conducted of a sample of 1,950 consumers representative of the U.S. population. Respondents were asked to indicate relative value of 11 attributes of ground beef, beef steak, milk, and chicken breast. Freshness and safety ranked highest. Health, price, taste, and nutrition were in a medium grouping. Lowest in importance were environmental impact, hormone free/antibiotic free, animal welfare, origin/traceability, and convenience. There was generally little difference in results across the four food products.
http://www.agmanager.info/livestock/marketing/BeefDemand/default.asp
EFFECT  OF  HORN  FLIES  ON  MILK  PRODUCTION
A study was conducted on 53 spring-calving Brangus-crossbred cows. Horn fly counts and milk production estimates were recorded monthly from May through October on individual cows. Fly counts were lowest in May and highest in August.  Higher fly counts were associated with lower milk yield and lower percent milk fat. Milk yield was affected more by fly count in May-June (when cows were in early lactation and milking at highest levels) than in August-October. Higher fly counts decreased milk yield most in higher-milking cows. These results are perhaps another indication that adverse factors in the production environment, including horn flies, have greatest effect on higher-producing individuals.
(J. Animal Sci. 92:1208; Univ. of Arkansas, USDA-ARS at El Reno, Ok.)
RELATIONSHIP  BETWEEN  INSTRUMENT-EVALUATED  MARBLING  AND PALATABILITY
Since 2006, instrument grading of beef carcasses has been approved by USDA. A study was conducted to assess how marbling estimated by instrument is related to eating characteristics. From four major packers located in Colorado, Kansas, Nebraska, and Texas, 718 steer and heifer carcasses were selected for evaluation. All carcasses were A Maturity, which comprises the vast majority of carcasses submitted nationwide for USDA grading. Only about 1% each was of visibly apparent dairy type or Bos indicus influence. Approximately equal numbers of carcasses were included with the 7 degrees of marbling ranging from Traces (the level for USDA Standard) to Moderately Abundant (the level for mid-Prime). About 70% of the carcasses were “A-stamp”, that is, identified at slaughter as ≥ 51% black hide, and therefore potentially qualified for Certified Angus Beef if carcass factors are acceptable.
From marbling degrees of Traces through Modest (mid-Choice) there was little difference in distribution of heifers and steers. However, from Moderate (high-Choice) to Moderately Abundant (mid-Prime), 60-70% of the carcasses were heifers. About 50% of the carcasses with Traces marbling were A-stamp, but over 90% of carcasses with Moderately Abundant marbling were A-stamp. As level of marbling increased, fat cover tended to increase and rib-eye area decrease, therefore numerical Yield Grade increased (lean:fat ratio decreased). Carcass weight was not significantly different, except that carcasses with Traces were lighter.
Strip loin steaks were evaluated. As level of marbling increased, there was also increase in mechanically-evaluated tenderness and taste panel evaluation of juiciness, meaty/brothy flavor, and buttery/beef flavor. As marbling increased, bloody/scummy flavor, livery/organy flavor, and grassy flavor decreased. Almost all (98-99%) of carcasses with marbling qualifying for Prime received positive ratings for overall sensory experience; others were upper 2/3 Choice = 80-90%, low Choice = 62%, Select = 29%, Standard = 15%.   Overall, the authors concluded that instrument evaluation of marbling “effectively identifies subsequent differences in eating quality”, of broiled strip steak.
(J. Animal Sci. 91:1024; Colorado St. Univ.)
COW  TEMPERAMENT  VS.  CALF  GROWTH
A total of 380 cows in two herds were evaluated before calving for chute behavior and chute flight speed, and behavior when isolated. Shortly after calving, cows were scored for defensiveness when calves were ear tagged and when a cow-calf pair was isolated; calves were given a subjective vigor score. Calf ADG was measured to 7 months of age.
In one herd, temperament and defensiveness were unrelated; in the other, cows more nervous in the chute were more defensive. Across both herds, temperament and defensiveness were unrelated to calving ease or maternal behavior shown to the calf. In one herd, cows more nervous in the chute had calves lighter at birth and calves from cows more agitated when isolated before calving had lower ADG. Defensiveness was not related to either calf ADG or vigor; pre-calving temperament was not related to calf vigor. The authors concluded that “pre-calving temperament and post-calving defensiveness appear to be independent traits” but “fearful cows may produce calves with decreased birth weight and ADG”.
(J. Animal Sci. 91:4417; Anim and Vet. Sci. Group, SRUC, Scotland)
DOES  SITE  OF PROSTAGLANDIN  INJECTION  AFFECT  ESTROUS  SYNCHRONIZATION ?  
Industry efforts have significantly reduced injection-site lesions in valuable beef cuts. This has been accomplished by making injections in the neck region, as outlined in Beef Quality Assurance programs. A group of 308 Angus multiparous crossbred cows in two herds were injected in either the neck or rump with prostaglandin, as part of either a standard or modified estrous synchronization program. Site of injection did not significantly affect conception rate. Conception rate did not vary whether insemination was immediately after synchronization or 21 days later. The authors concluded that “location of injection did not change breeding or pregnancy rates” so “producers should follow BQA guidelines” when using estrous synchronization.
(J. Animal Sci. 92 E-Supple 2:20; No. Carolina St. Univ., Ohio St. Univ., Pennsylvania St. Univ.)
GENETIC – ENVIRONMENTAL  INTERACTION
If cattle do not perform the same in different environments, then genetic evaluations in one environment may not be universally useful. An analysis was conducted on records of birth and weaning weights (n = 74,681), postweaning gain (n = 39,104), and stayability (n = 28,895) from the American Red Angus Association. Records were assigned to nine geographical regions of the U.S. (Corn Belt, Desert, Gulf Coast, Lower Plains, Mountains, Northeast, Pacific Northwest, South, and Upper Plains). Records were included only from sires with at least 50 calves and at least two regions.
Regional interactions were not important for birth weight, weaning weight, or postweaning gain. However, some notable interaction was found for stayability (probability of a female still being in the herd at 6 years of age). In general, interactions were lower for adjoining regions. The authors noted there was little interaction for growth traits, but “care should be taken when selecting sires to produce replacement heifers”. NOTE: lack of genetic – environmental interaction means ranking of sires’ genetic potential for a trait should be similar across regions. It does not mean actual level of performance in different regions would necessarily be the same (and often would not be) because performance includes both genetic and environmental influences.
(J. Animal Sci. 92 E-Supple. 1:9; Univ. of Missouri, Kansas St. Univ, Univ. of Zagreb, Croatia)
VALUE  OF  CERTIFIED  PRE-CONDITIONED  CALVES
The Oklahoma Quality Beef Network is a program designed to increase value of calves through improved health, general management, and marketing. Full details on requirements are available at http://oqbn.okstate.edu/ . Data were collected on 11,927 calves at eight sales in the fall of 2013. Prices were compared for OBQN-certified calves and non-certified calves.
Average premium for certified calves was $8.65/cwt. Over the previous four years the yearly average ranged from $6.54 to $9.23. Premiums were generally, but not always, higher for lighter calves. Combining the higher price and additional weight gain, and subtracting cost of preconditioning, estimated additional return per head for certified calves was approximately $54 for 2013. The authors of the report noted that any other variables possibly affecting price such as lot size, weight, breed, hide color, sex, fleshiness, and muscling were not considered in the analysis.
(Oklahoma St. Univ. Cow/Calf Corner Newsletter, 3/03/14)

The important role of expectations in the beef industry -Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist | Updated: Mar 18, 2014

Cattle and beef prices are at record levels in every industry sector, from cow-calf to retail beef prices. These record prices are obviously supported by a very unusual set of supply and demand circumstances. So far in 2014, markets — especially fed cattle and wholesale beef markets — have displayed unprecedented volatility as industry participants try to sort out these unusual market fundamentals in a very dynamic market environment.  Both producers and consumers are reacting, not only to current record prices, but also to their evolving expectations for market conditions over the coming weeks, months and years.
Much attention is focused on the low cow herd inventory and the need to rebuild. After many years of liquidation, the result of a variety of factors impacting the beef industry, the current situation reminds us that it is the cow-calf sector that is primarily responsible for supply in the beef industry. Until cow-calf producers can and will expand the cow herd, the industry’s ability to maintain beef production will be limited. Cow-calf producers make decisions about herd rebuilding by considering, not only current price levels, but also their expectations about how high prices will go and how long they will persist.  The cattle industry has a long history of production and price cycles so producers recognize that high prices now will likely lead to lower prices at some point in the future…it’s the old adage that the best cure for high prices is high prices.
However, the current situation is one of excess liquidation due to external factors that have taken cattle inventories to a much lower level than would have otherwise happened. The beef cow herd was poised to begin expansion in early 2011, prior to the last three years of drought. The beef cow herd then was some 1.8 million head larger than today. Moreover, the last cyclical expansion began in 2004 with a beef cow herd of 32.5 million head, with some 3.49 million more beef cows than today.  That expansion was brief and truncated by feed and input market shocks; recession; and drought that contributed to the subsequent liquidation since 2007. The path to the current herd level was long and the recovery will similarly take several years which should factor into producer expectations for most of the rest of the decade.
Demand is also affected by consumer expectations. There is considerable industry concern about how beef demand will react to the growing pressure for higher wholesale and retail beef prices. So far, it appears that beef demand is holding up well. Pork supplies are dropping now as a result of the PED virus and higher pork prices ahead will help support higher beef prices. However, abundant broiler supplies and relatively cheap poultry prices have, somewhat surprisingly, led to little substitution of chicken for beef so far. Consumers may be reacting differently to higher beef prices, in part, because of the expectations they have for the future. Considerable media attention has been drawn to the fact that beef prices will likely be high for an extended period of time. If consumers believed high beef prices were a short term impact, they would very likely avoid the high prices and substitute away from beef. However, the prospects for high prices for an extended period of time may be causing consumers to have more of a “get it while you can before the price goes even higher” attitude. Consumer preferences do not change easily or quickly. Consumers resigned to higher beef prices will make some adjustments but will continue to purchase beef.

October is National Feral Hog Month

Damage caused by feral hogs is a growing problem because of their destructive feeding habits, potential to spread disease and increasingly growing population. There are resources to increase the understanding of feral hog biology, natural history, damage management, and control techniques.
Go to http://feralhogs.tamu.edu/ to find out more about these destructive animals.  They have been in Rockwall County for many years. Residents do not understand the danger that these hogs can be and the fatal damage they can inflict.

Fluffly cows cast light on beef Terri Queck-Matzie | Updated: 08/15/2013

Matt Lautner
When photos of Matt Lautner’s prize show bull Texas Tornado appeared on a popular online forum Reddit, he had no idea it would create an Internet sensation. Nor did he have any indication an opportunity to open a window to the beef industry was coming his way.
Then someone commented on the “fluffy cows” — a term coined online — and the cyber world had a new mascot.
ABC News, the Associated Press, the Today show and CNN all took note and ran stories on the phenomenon. Texas Tornado went viral. A Facebook page, Fluffy Cows R Us, created by Lautner, compiled 37,000 “likes” in just weeks.
And Lautner seized the opportunity. “Now that we’ve got their attention, I think it’s a great opportunity to teach them about our industry,” says Lautner, who breeds show cattle near Adel, Iowa. “Every year, millions of Americans walk through the cattle barns at fairs and expos, and now, more than ever, I think they are going to stop and really take a look at the fluffy cows in the aisles. This is the perfect opportunity to talk about not just fluffy show cattle, but also beef and beef by-products.”
Lautner is by nature and by trade a cattle breeder and promoter. Lautner genetics are a common sight in show rings across the country, frequently winning top honors. And Lautner makes expert use of today’s communication tools to highlight their success. With sites like Reddit, Facebook, Twitter and a daily blog on his own website at his disposal, he utilizes digital communication to its full potential. “Promotion is key, in my business and the beef business in general.”
Lautner has been around beef since he was a kid. His dad started raising show cattle in the 1970s, and Matt started Matt Lautner Cattle in 2006. Three sales each year feature offspring from his 60 bulls, and he puts an emphasis on 4-H and FFA calves, selling around 75 per year. Last year Matt Lautner Cattle sold semen in 44 states.

In the retail industry a major part of marketing can be about location, location, location.  I believe the article above illustrates that.  What a great opportunity for beef producers to catch a hold of to showcase their cattle.  This positive influence is great for ag industry and all of the disciplines and skills that are learned through it. 

Wholesale beef prices set new records

Drovers/CattleNetwork news source   |   Updated: May 29, 2013

  

Source: John D. Anderson, Deputy Chief Economist, American Farm Bureau Federation
After bouncing around mostly between $185 and $195 per hundredweight (cwt) since the end of summer last year, wholesale beef prices earlier this month finally moved into record territory above the $200 mark.  Last Thursday, the Choice cutout value reached $211.37 before slipping back below $209 on Friday.  For the week, the Choice cutout worked out to $210.47, up $2.98 from the prior week.  The cutout value has been led higher by strong prices on middle meats.  As of last Friday, the Choice cutout stood at $208.87, up $9.38 from its price at the beginning of the month.  Over that period of time, rib and loin primal values increased by $29.52 and $28.36, respectively.  By contrast, chuck and round primal values were basically unchanged during that time.
The strength in the boxed beef cutout in May was likely supported to a great extent by retailer purchases in advance of the Memorial Day holiday.  The outsized performance of middle meat prices lends credence to this notion.  These are the cuts whose highest and best use is on the grill; and Memorial Day is definitely a grilling holiday.  One might hope that this year’s generally poor spring weather (too cool and too wet in many parts of the country) has contributed to a pent-up demand for grilling that was finally satiated this past long weekend.  No doubt retailers have already assessed the post-holiday condition of their meat cases.  Whether or not they are happy with the holiday movement of beef will have a lot to do with where wholesale prices head from here.
Another factor that will be key to the future direct of wholesale beef prices is the performance of competing meat prices.  Those have been very supportive of late.  For example, after being flat for just about all of 2012, boneless/skinless chicken breast prices have recently surged, climbing to over 200 cents/pound last week from around 150 cents per pound in mid-April.  This is the highest b/s breast price since about this same time of year in 2004, when prices briefly climbed into the mid-200s.  At that time, though, prices on other cuts were such that the 12-city broiler composite never exceeded 85 cents per pound.  By contrast, last week’s national broiler composite (successor to the now-discontinued 12-city price series) worked out to 113.53 cents per pound, reflecting dark meat and wing prices that are far above 2004 levels.  Wholesale pork prices have also managed to move up along with the competition.  The pork cutout finished the week last week at $94.42 / cwt (FOB plant).  As recently at early-April, the pork cutout was struggling to get above $80.
Looking ahead, competing meat prices are likely to become less accommodative of higher beef prices.  Last week’s Cold Storage report showed a substantial increase in both poultry and pork stocks.  Frozen chicken and pork supplies both increased by 8% over the prior month.  For chicken, dark meat stocks increased fairly dramatically, with drumstick and leg quarter stocks up 26% and 19%, respectively.  By contrast, breast and breast meat stocks were actually down 2% month-over-month.  For pork, the biggest increase in frozen stocks was also in the lower-valued cuts.  Picnic and ham stocks were up 26% and 33%, respectively, compared with the prior month.   With trade to China and Russia still disrupted, a larger share of this product will have to find a home on the domestic market – clearly not a positive feature for the wholesale market moving forward.
The Markets
Cash fed cattle prices were down slightly last week, with the 5-Area weighted average steer price coming in at $124.75, down $0.63 from the prior week.  This is the third straight week of lower fed cattle prices – not a terribly unusual development, as the market is generally migrating between its spring highs and summer lows at this time of year.  Feeder and stocker prices last week were reported to be somewhat uneven.  The National Feeder and Stocker Cattle Summary report from USDA Agricultural Marketing Service called feeder calf prices “unevenly steady to weak” but noted reported prices mostly ranging from $3 higher to $3 lower.  Calf prices were called mostly steady to $3 lower, with very light runs of calves in many locations.  Corn prices were higher last week.  The Dec ’13 contract added about 15 cents between Tuesday and Friday, with most of that gain coming in Wednesday’s trading.  Corn planting, which proceeded at a record pace week before last, was likely slowed down considerably by late-week rains last week.  It is likely that those rains will close the window for corn planting in some locations, with farmers shifting remaining acres to soybeans.  It remains to be seen how large that shift will be.  At any rate, corn acreage will still be formidable; and last week’s rally probably had has much to do with some surprisingly good offtake figures as it did with lack of planting progress.