US Beef Prices Hit 10-yr Peak
U.S. beef prices jumped to a 10-year high on Wednesday as the arrival of warm, dry weather over much of the country will have backyard chefs firing up grills and throwing on steaks and hamburgers, analysts said.
Until this week, spring weather has been a mixture of cold, snow, frost and rain, none of which is conducive for picnics or backyard cookouts. But as temperatures rose across much of the country this week, reaching the 80s Fahrenheit in Chicago, analysts expect a seasonal surge in beef sales.
The wholesale price choice beef, or cutout, on Wednesday jumped $3.10 to $199.49 per 100 lbs (cwt), the highest since $200.65 on Oct 20, 2003, according to U.S. Department of Agriculture data.
“We’ve not yet seen the big demand push we normally get by this time of year because of weather issues. But the cutout surge suggests a kick-start for grilling, Mother’s Day features and Memorial Day bookings,” said Don Roose, analyst with U.S. Commodities in Des Moines, Iowa.
Consumers already are paying record high prices for beef and the latest surge in the wholesale market may push supermarket prices even higher.
Despite temperature spikes this week that were more reminiscent of summer than spring, snow and freezing rain continue to cover parts of the Midwest, and more cold is forecast.
Temperatures in Amarillo, Texas, on Tuesday topped out at 97 degrees Fahrenheit (36 Celsius) with temperatures expected to plunge into the low 30s F by Thursday morning, said David Hales, president of Texas-based Hales Trading Co.
At supermarkets the average beef price in March was a record $5.30 per lb, eclipsing the previous record of $5.15 set in November, according to USDA’s Economic Research Service.
Those higher beef costs and reduced consumer discretionary spending may cause some consumers to switch from beef to other competitively priced meats.