Certified Angus Beef Market Commentary premiums... · somewhat uncomfortable with current wholesale price offerings. Cattle markets also realized a sharp movement lower with sales

Certified Angus Beef® Market Commentary

Urner Barry Publications, Inc. • P.O. Box 389, Toms River, NJ 08754-0389 • 732-240-5330 • [email protected]

Q1 - 2015

Week of: January 08, 2015

Beef markets including the CAB® complex has realized a typical seasonal market, only to be magnified by somewhat tight supply of

product coming off the recent holiday weeks that saw the lightest slaughter tallies in recent history. End cuts, thin meats, loin cuts, as

well as ground beef values all posted hefty gains in values. Our brisket quote this week was almost 5% up from week prior. Strip loins

were up almost 10%, while many end cuts gained 4% to %%. CAB® ribs and tenderloins slipped in value, as buyer’s attention was

diverted to other offerings and features.


As the calendar has worked its way from the holiday season, beef markets have been largely impacted by very light, if not record

breaking low slaughter rates. End cuts found interest from both retail and ground beef processing, and gained value. Thin meats will

usually see strengthening in value from disciplined production schedules, and the past three weeks did just that. The overall tone with

the CAB® Rib complex was softer, while loin cuts such as the strip and PSMO found renewed interest and higher trading ranges. A bit of

caution became apparent as we approached the end of this reporting period for the weekly CAB® Market Report; buyers became

somewhat uncomfortable with current wholesale price offerings. Cattle markets also realized a sharp movement lower with sales of

slaughter-ready cattle, precipitated mainly by February’s Live Cattle Futures Contract pricing moving nearly $9 lower from the close of

pit trading after last week’s published CAB® Market Report.


Beef markets including the CAB® market were blanketed with a hefty amount of downside pressure over the past week. After the recent

weeks post- holiday season where end cuts were trading at firm levels, values for both chucks and rounds have eroded. Items such as

the bottom round flat, inside round, and chuck roll such somewhat large drops in values. Middle meats also became victim to lackluster

buyer’s interest, with both ribs and strip loins losing a hefty amount of value. The CAB® lip-on dropped almost 5% in a week’s time. Thin

meats remained a stellar performer for CAB® licensed processors, and ground beef values for the week were near steady when analyzed

against last week’s market.


The bias for the spot CAB® market as well as commodity beef was negative over the past week. Demand continues to fall short of

clearing supply, leading to packers issuing price reductions for quick ship opportunity. End cuts loosing value have were the main drivers

with the CAB Carcass Cutout moving lower, with some loin cuts also contributing. Thin meats were mixed; briskets, skirt meat, pectoral,

and lifter meat saw discounting, while ball-tips, tri-tips, flank steaks and flap meat sustained a fairly firm spot market sentiment. CAB®

Rib quotes this week found lower ranges, drifting another 2% lower from prior week, attributed to buyers remaining conservative with

procurement for the immediate time. CAB® ground beef quotations saw lower ranges develop, as retail and foodservice buyers were

content with prior commitments leading into February and this weekend’s Super Bowl festivities.



Week of: February 05, 2015

The CAB® market continued its downtrend this past week. Sellers struggled to move product as February business lacks that spark

needed. The price of beef compared to both pork and poultry has only compounded the situation. Chucks and rounds remained

squarely in the crosshairs of the major discounting. Support for short and strip loins remains a little ways out so sellers in an effort to

clear product to get in better position for this time sold product lower. Ribs firmed slightly as Valentine’s Day business and recent losses

sparked better interest. Top butts also firmed. Ground beef was also lower. Despite a typical occurrence this time of year some thought

it might be different. Snow storms around the country on multiple occasions had some thinking that buyers would be active.

.


The past week for the CAB® market saw some product finding higher trading ranges, as buyers start to secure for their springtime

needs. Middle meats typically find support at some point in the month of February, and this year is no different. Ribs, strips and top

butts moved higher week/over/week given the seasonal push higher. End cuts realized a mix of both discounting and increases; the top

round has received a fairly strong call as buyers look for product to cover “London Broil” features. Offsetting the stronger sentiments for

middle meats and a variety of the end cuts were weaker sales of thin meats and coarse ground beef. Not only did skirts, flap, and flank

steaks edge lower in value, briskets also have become available as further processors readying their coolers with corned beef for next

month’s St. Patrick’s Day festivities have their needs satisfied for the most part.


Middle meats have found support build as buyers start looking for their springtime/barbecue season inventory. Ribs saw some of the

biggest week/over/week gains, slightly outpacing the increases realized by CAB® strips and short loins. Top Butts also reached higher

trading levels, as both the foodservice and retail sectors booked product for their near term offerings. The clod tender (teres major) has

seen its wholesale pricing increase, as restaurants look at current quotations and sense a value. Supplies of CAB® for the most part have

met the current level of demand; presently the Choice Grading Percentage has climbed to 69.50% of the eligible cattle herd, reaching a

level last seen in 1996.


Price increases continue to be driven by supply-side management. And the lower kills have product and interest more in balance. The

CAB® market saw another weekly cutout gain. Ribs were again the notable winner as buyers position themselves for better weather.

The expectation is that this should spark better increased buying amid pent up demand. Chucks and rounds also firmed week-to-week.

A combination of cold weather and feature activity led retailers to restock some inventory. Strips and short loins were generally steady.

Ground beef was the same.



Week of: March 05, 2015

The CAB® market now appears driven by a seasonal and supply side influences. As spring is coming into view, buyers are looking to

shore up their inventory of ribs and loins. Top butts have found strong interest, piggy backing off of the main steak offerings such as the

rib eye and strip loin. Ground beef has also gained support behind recent supply discipline exhibited by the packing industry.


As seen with commodity beef markets, the CAB® complex is seeing the classic “push and pull” with the primal sectors. Ribs remain the

best performer for licensed CAB® processors. The round primal realized a fairly large amount of negative pressure, with insides needing

discounts to clear wholesale coolers. The peeled knuckle was the only cut from the hind quarter that found advanced trading ranges.

The loin primal over the past week had mixed result; strips, short loins and top butts drifted lower in value, while tenders and ball tips

edged higher in value. CAB® ground beef values held near steady levels, as supply and demand remain closely balanced for the moment.


The rib market remained well sold as packers positioned themselves well for this time period. Buyers focused on this week as they were

hoping the weather sparked some pent up demand for grilling activities. And there were certain pockets of the country that this played

out. With spot offerings tight, prices were again able to advance. A few other alternative steak items followed higher. End cuts exhibited

some weakness as offerings continue to outpace demand. Ground beef was also weaker. Cheap pork continues to weigh on the beef

market overall.


As written in last week’s CAB market comments, the CAB rib market is positioned well heading into the spring season as buyers book

product for approaching features. Retail business however remains stalled for the moment, as spring weather in areas such as the Mid-

Atlantic and Northeast states of the U.S. has not arrived. Looking at other primal areas of the CAB market, loins have seen increased

value as buyers seek product for their forward needs. End cuts saw varied movement with values over the past week. Helping lay a floor

for spot pricing is packer’s maintaining curtailed processing schedules, as they utilized cutbacks to improve operating margins that are

still entrenched in negative territory. Ground beef values moved only slightly from week prior levels.

Q2 – 2015

Week of: April 02, 2015

The CAB Carcass Cutout saw a week/over/week gain which was spurred by advancing rib and loin values. As the spring seasonal market

starts to take shape with the calendar turning the page to April, buyers have increased their interest to acquire their steak items for

approaching features. End cuts traded at steady to weaker levels, given the diversion over to the middle meats. Packers have increased

slightly the pace of slaughter/processing over the past week, placing a few more end cuts in their coolers. Knuckles remained the only



solid performer within the round complex, finding a home with both retail and grinders. Insides, bottom rounds, and eye rounds needed

discounting to move wholesale inventory.


Advances continued this week in the CAB® market, spurred by tighter overall supplies and the need to build margins by packers. Middle

meats were once again the largest contributor as buyers look for items consumers will put on the grill. End cuts edged higher with

tightness being noted for teres major and chuck rolls. The former seems to be garnering a lot of attention from various foodservice

outlets for an alternative to traditional steak cuts. Thin meats are sought after and needed to be bid higher in order to procure from

limited offerings. Trimmings were mostly steady. The rise in costs are squeezing retail margins and there is concern any more price

advances are expected to lead to consumers into alternative proteins.


The past week’s market posed very few surprises when it came to price swings for CAB® product. Even with last week’s record low

weekly F.I. Slaughter of 502,000 head, seasonal trends remained intact. The most talked about price movement was flap meat, which

surged higher and reached well above historical data base highs. Many thin meats including flap meat advanced to seasonal record

highs. Most end cuts slipped slightly lower in value, while middle meats posted gains as buyers secure product for the start of grilling

season. Briskets saw price breaks develop, as the current call for quick ship diminished. CAB® ground beef values were mostly

unchanged week/over/week.


Beef markets including the CAB® sector continue to wait for the earnest arrival of spring demand. Retail clearance of beef remains fair-

at-best as weather in areas such as the Northeast U.S. remains cool. CAB® end cuts are finding lower negotiated values develop along a

typical seasonal trend. The past week’s market for branded middle meats was mixed; CAB® ribs slipped lower while strips and short

loins saw firmer values established. Thin meats such as flap, flanks, and skirt meat continue to find a strong call amid short supply. Slight

price breaks were noted with CAB® ground beef, as spot inventory was available and not receiving a balanced level of interest.


As seen with commodity beef markets, the CAB® complex is now blanketed with a mixed tone. Middle meats specifically has seen a

varied spot market develop; strips and short loins trading at firm levels while some price breaks have developed with CAB® ribs. CAB®

brisket values slipped lower, while thin meats from the CAB® carcass largely traded over the past week at firm levels. CAB® chuck and

round values moved lower as buyers focus on middle meats and thin meats for the upcoming spring season. CAB® ground beef

quotations closed on our weekly report at steady to lower levels.



Week of: May 7, 2015

Hefty week/over/week gains once again developed with CAB® strips and short loins, and those middle meats continue to play a large

role with loin primal cutout values remaining at current data base historically high levels. As the Memorial Day holiday draws near, the

CAB® market continues to see a mix of discounts and advances, with CAB® ribs and thin meats seeing the varied spot market movement

of late. CAB® end cuts over the past week traded with varied sentiments as well: rounds finding some support while most chucks seeing

a decline in value. CAB® ground beef values edged higher.


Advancing loin values have propelled cutout higher, and that scenario has played out in both commodity beef and CAB® markets. Strips

and short loin values in this spring market run up continue to reach well beyond previously attained data base historical highs. CAB® ribs

over the past week found additional support as buyers look to secure last minute inventory for their upcoming Memorial Day features.

CAB® end cuts saw mixed results develop; inside rounds values firmed as “London broil” features are about to make their way to front

page of supermarket circular ads. Peeled knuckles, eye rounds, and chuck rolls eased slightly lower given the focus on other chuck and

round cuts. CAB® ground beef prices moved slightly higher, as an increase in demand developed given the approaching holiday where

grilling is a popular event.


As the calendar has wound down towards this weekend’s Memorial Day holiday, the strength that lingered over ribs and loin offerings

for some time now has faded a bit. Most of the strength within the CAB® spot market was realized late last week and early this week,

but the tone to the market has now eased; buyers became content with commitments for holiday features, leaving spot production

available for the taking. CAB® ribs devalued slightly over the past week as did the top butt. Small gains were realized with strips and

short loins, where values remain at both 52 week and historical data base record highs. CAB® end cuts such as the chuck roll, clod heart,

peeled knuckle, as well as the inside round edged lower with the value on the spot market. The overall tone to CAB® grinds was steady.


The CAB® market since the past weekend’s Memorial Day holiday has seen a seasonal downturn develop. CAB® Rib and Loin values have

moved sharply lower. Loin values have moved lower from historical data base record highs. CAB® end cuts are presently realizing a

mixed level of trade; inside rounds holding near steady while peeled knuckles and chuck rolls seeing discounts applied for spot

production. Thin meats also seeing a varied level of trading; flap meat continues to devalue after peaking a few weeks ago at record

highs. Ground beef sales have not deviated much from last week’s market quotations.

Week of: June 04, 2015

The value of CAB® rib and loin meat continues to devalue as the spring beef market looks to turn the corner towards the summer

season. With booking of Father’s Day and 4th of July features coming down the homestretch, the tone to the overall CAB® market

remains weak. CAB® end cuts over the past week or so, saw values decline, as buyer’s interest for chucks and rounds was below the



level needed to move wholesale inventory. The market for thin meats remains mixed, with flap meat seeing additional discounting, and

packers continue to seek clearing prices. The market for CAB® ground beef over the past week was about steady, to slightly lower.


Middle meats continued their decline this week. Interest to procure ribs and strips has slipped after Memorial Day and hasn’t found

business brisk enough to keep prices at the lofty levels seen just prior. Some of the declines were hefty but looking at some past charts

it seems to be the norm this time of year. End cuts reversed the previous trend of weakness. Some of the more value steak cuts found

support from retailers planned features, especially London Broil on the East Coast. This led to higher prices. Grinders provided

additional support to some of the muscle cuts on top of the cutback in slaughter rate. Course grinds generally about steady.


CAB processors have firmed their attitude with spot market offerings of end cuts, thin meats, and coarse grinds. Sustained support for

end cuts has continued as ground beef processors remain active. The current low seasonal level of fed slaughter/production has also

provided support for chucks and rounds, as well as most thin meats. Ribs and loins have taken a back seat as far as demand is concerned

given the focus on end cuts, and values continue to slide lower.


Disciplined slaughter/production remains a supportive reason with both commodity beef markets as well as the CAB complex. While

beef packers have maintained seasonally light slaughter rates given the low level of market-ready supply of cattle on show lists, demand

from ground beef processors for chucks and rounds has pushed wholesale values higher and left spot inventories in a well-sold position.

Loin values continue to correct from the record highs set before the Memorial Day holiday, and going into next week’s 4th of July

holiday, sellers are looking for bottom-line clearing levels. CAB ribs found stability over the past week, as buyers look to top off their

supply heading into the holiday week. CAB ground beef values pushed moderately higher since last week’s report as retail featuring has

increased.

Q3 – 2015

Week of: July 2, 2015

As the calendar closed in this coming weekend, the extended weekend that will celebrate Independence Day in the U.S., beef markets

have seen negative pressure build to a level that have brought about heavier discounting for spot market product. Buyers resisted

adding onto their current inventory commitments, prompting the CAB licensed packer to back off some of their pricing for fresh

production. The discounting not only was occurring with loin offerings which have seen reductions occur over the past few weeks, but

end cuts began trading at lower levels, with some of the trading ranges sharply lower from week prior. CAB thin meats continue to see

mixed market tones; ball-tips remain at historically high levels while brisket values slipped lower. CAB ground beef values held near

steady.




Spot market conditions usually weaken coming out of the 4th of July holiday, and this year’s market reacted in that manner. Although

strips and short loin values were slipping lower after the Memorial Day holiday, further erosion has continued as packers seek levels

that will clear spot inventory. End cuts have also realized weaker spot trading given a pullback in demand for ground beef. Thin meats

for many weeks in the spring were trading at firm levels, and “summer doldrums” have materialized which now is playing a part w ith

declining spot values. CAB ribs saw a minimal price break over the past week, but continue to trade at fairly steady levels.


Middle meats continued to struggle this week with hefty discounts realized on ribs and loins. Interest from buyers is lackluster following

the July 4th period and things have been the same this year. In fact, a widening spread between beef and other proteins has also

suppressed demand. End cuts stabilized week-to-week and it seems we are starting to see interest a little early as prices have come off.

This could help CAB cutout values minimize losses. Less than average movement led to some discounts on course grinds.


A summer malaise continues to hover over beef markets including the CAB complex. Licensed CAB packers are presently struggling to

find stability with their middle meat prices as well as many of their thin meat offerings. Retail buyers are simply staying very

conservative with bringing any additional product into their spot inventory mix, as consumers are spending more time on vacation and

visiting foodservice establishments rather than their local supermarket meat case. Competing proteins remain a stumbling block for

beef sales, given the availability and attractive price point versus current retail beef prices. Ground beef feature visibility has waned

since the early stages of the month, and wholesale prices have slipped lower.


The same seasonal patterns in the commodity beef market are evident in the CAB® complex as well. Demand overall is sluggish and is

further pressured by the extreme heat in many areas of the country. Supplies of middle meats, despite low slaughter numbers, remain

burdensome for the level of interest currently seen. Ribs, strips and short loins continued to fall. Thin meats were also weaker after they

followed the main steak cuts higher. It was apparent they were going to follow them lower. Chucks and rounds were in much better

shape. Chucks generally steady to higher while rounds saw price advances amid increased buying spot and forward. We are starting to

see inquiries from the grinders that may lend further support. Course grinds slightly better.



Week of: August 06, 2015

As the calendar turned into the last month of the summer, trade seemed to slow a bit. Most of the trade registered was within last

week’s range but there were a few changes – some that surprised given the overall climate. Ribs, strips and short loins were fully steady

to firm after some recent weakness. Buyers used previous discounting as opportunities to enter market. End cuts were better overall

with chuck rolls and eye rounds the notable winners. Thin meats still struggled for support. Ball-tips deteriorated quickly mirroring the

theme in the commodity beef market. Tri-tips, skirt steaks and flank steaks also much lower. Course grinds steady.


Demand for boxed beef including CAB product remains seasonally lackluster, but values with the total CAB carcass cutout, CAB end cuts,

as well as CAB middle meats have taken an upswing over the past week. Given the shortfall of market-ready cattle, slaughter rates

remain well below year ago; the YTD Federally Inspected Slaughter is presently tracking nearly 6% lower when compared to same period

last year. While the overall inspected slaughter/production is at seasonally low levels, strong choice grading has lent to an increase in

the acceptance figures of CAB eligible cattle. Current data which detailed the last 4 weeks of CAB acceptance has a 29.9% rate versus

the same 4 week period in 2014 at 27.2%. The CAB market during the past week saw middles post rather gains in value; end cuts were

moderately higher, while thin meats for most of the report period struggled until realizing some clearing price levels. Coarse grinds

edged up in value.


After a couple of weeks where cutouts were pushed higher by advancing spot market prices for both end cuts and middle meats, the

market over the past week has seen a more tempered tone. Ribs and loins continue to exchange ownership at higher levels, as buyers

seek product for the upcoming Labor Day holiday, as well as secure needs for the fall market. End cuts were moving at a fairly brisk pace

from the packer’s cooler, but demand has eased as buyers feel fairly content with current commitments. Thin meats continue to be

somewhat problematic for the packer including the licensed CAB processor. Ground beef has found support, as the retailer books

product to cover their feature ads.


The CAB market heading towards the approaching Labor Day Holiday weekend is trending in a rather typical seasonal fashion. Buyers

have shown a fairly active interest with securing middle meats for both the upcoming end of the summer holiday, as well as looking at

booking orders for their autumn and winter holiday inventory. Most loin offerings continued to find support, with the exception being

the top butt which had reached levels that became a bit of risk in the buyer’s mindset. End cuts over the past week struggled to find a

steady level of demand, and packers were forced to discount for spot market sales. The market for thin meats was mixed—ball-tips, tri-

tips and inside skirts remained under negative pressure while flap meat and outside skirts bounced higher in value. CAB ground beef

values were also mixed.



Week of: September 03, 2015

A pre-holiday hiatus has occurred with beef markets including the Certified Angus Beef complex. Buying interest has retreated as many

companies fear bringing in extra inventory may be a bit of a risk given the typical seasonal lackluster demand that occurs around the

Labor Day holiday weekend. The CAB market over the past week saw only a few quoted items hold value, most specifically seen with

top butts, peeled tenderloins and outside skirts. Strips, short loins, and ribs slipped in value, as did both round and chuck cuts. Thins

meats other than the outside skirts and briskets also weakened with spot market value. CAB ground beef demand has softened, lending

to discounted quotations.


The market for Certified Angus Beef after last weekend’s Labor Day Holiday is seeing discounting overpower price increases. CAB middle

meats are seeing a seasonal price correction, which is fairly characteristic for both ribs and loins after the holiday and prior to the ramp

up for the upcoming winter holiday procurement. Most chucks and rounds have also devalued, with the noted exceptions being flats

and eye rounds. The majority of thin meat offerings struggled for steady over the past week. Skirt meats bucked that trend and found

support for near term shipment. CAB ground beef values slipped lower, as demand has waned following the holiday weekend.


A weak tone continues to linger within the CAB market. CAB inventories of most types and sizes remain available on the spot market,

while interest for quick ship is falling short of pulling wholesale supplies from the CAB licensed processor’s coolers. The weakness is seen

across the entire CAB carcass, and includes manufactured CAB ground beef. Cattle grading either Choice or Prime continue to enter the

slaughter mix at an increased Y/O/Y pace. The latest USDA figures for the Choice Grading Percentage has move slightly lower recently,

reported now at 69.08%, compared to this week last year at 64.50%. Prime Grading currently reported at 5.02%, with the same week

last year at 3.98%.


Like the commodity box beef market, there seems to be a fair amount of CAB product being offered against light interest. This has taken

the air out of prices and the downtrend remains firmly in place. Large discounts have become the norm as packers are more than willing

to keep product moving through the pipeline than have further backup in the current demand environment. No primal was immune.

Even CAB ground beef saw further erosion. Goosenecks seem to be in manageable position and even eked out a slight gain week-to-

week.



Q4 – 2015

Week of: October 1, 2015

The broader weakness in the live cattle and commodity beef markets has spilled over into the CAB® market for the sixth consecutive

week. Double digit discounts became the norm on most items as sellers looked for levels that incentivized buyers. It seems to have

worked to some extent as interest started to improve at these prices levels. In fact, many items are at 52-week lows. Downside risk still

appears to be more likely than other scenarios given the imbalance between supply and overall buyer interest.


There were plenty of boxes around this week and CAB® sellers continuing discounts in order to push product and clear inventory on

hand. Middle meats were mixed. Ribs slightly discounted while loin meat losses provided buyers plenty of opportunity. End cuts also

had weakness spill over. The most problematic areas appeared to be grinds and thin meats which showed the largest pace of declines.

Packers are hoping these levels and the associated increase in activity helped put them in better position moving forward when

seasonals should change. Look for a firmer stance on holiday type items over the next few weeks.


Wholesale Certified Angus Beef inventory is in relatively improved position this week, playing a role in higher quotes for spot

production. CAB® licensed processors were able to push most of the middle meats higher, with just a few loin cuts still under some

negative pressure. Top butts and peeled tenderloins slipped lower in value, given soft demand for near term shipment. Chucks and

rounds found higher trading ranges, as improved seasonal interest has developed and retail buyers have stepped in to cover their

current and upcoming feature ads. Thin meats and ground beef values edged higher, after seeing a stagnant performance over the past

few weeks.


The bulk of wholesale beef pricing of both commodity beef as well Certified Angus Beef product over the past week saw additional

gains, but the pace of the advancements was not as brisk as seen during the prior few weeks. Seasonal adjustments continue to take

place with most middle meats, with the most glaring exception being the top butt that continues to slip lower in value. End cuts posted

modest gains. Most CAB thin meats gained value, as did ground beef.


As seen with recent commodity beef programs, the current Certified Angus Beef market is realizing a mixed market. CAB ribs have found

firmer attitudes and pricing for product to ship either immediately or in forward time slots. Looking at the loin complex, CAB strips and

short loins saw modest gains develop over the past week, while top butts have struggled to hold steady levels. A mix of both advances

and discounts are noted with CAB end cuts; bottom rounds, flats, eye rounds, and chuck tenders have seen some price reductions

associated with spot market production. Ground beef prices held near steady levels.



Week of: November 5, 2015

Spot market demand for product other than ribs, strips and tenderloins remains fair, as buyer’s present needs are light given a shift in

their focus over to other proteins such as Thanksgiving Turkeys and hams. The market for end cuts is presently stymied by both the

calendar approaching the Thanksgiving holiday, as well as unseasonably warm weather in many regions that has slowed sales at retail

counters for beef roasts. CAB ground beef values slipped lower from week prior quotations, partly attributed to soft demand and

attractive pricing with some competing proteins.


The CAB® market rolled over this past week as turkeys started dominating the retail circulars. Weakness was broad based and nothing

was immune. The level of kills has surpassed the moderate at best interest. With freezers stocked, the only way to move product was to

attach a discount to it. Thin meats, especially the brisket were some of the largest decliners. It’s been a steady ride down since early

year record levels and prices now approach more historical norms on this item. But as previously mentioned, the whole complex was

soft.


With the lone exception being the CAB® Rib Primal section of the branded carcass, all other CAB® Primal Carcass cutout values

plummeted lower. CAB® licensed processors continue to struggle with finding prices that will clear both chucks and rounds, and

wholesale loin inventories are now ample for the current call. Beef retailers are “chomping at the bit” with reacquiring space in their

meat cases once the Thanksgiving holiday commences next week. Demand for CAB® ground beef is presently fair-at-best, and wholesale

values have moved moderately lower.


A slight improvement in valued was noted with a few CAB® cuts, but over the past week some primal sections of the CAB® carcass

struggle for steady. One thing for certain with beef markets including the CAB® complex is that industry participants eagerly await the

post-Thanksgiving market with the hopes that beef features find support prior to the Christmas and New Year’s break. CAB® Ribs remain

a solid performer for licensed packers, while end cuts over the past week saw discounts applied. CAB® Ground Beef values slipped lower

as demand was not strong enough to support spot values.



Week of: December 03, 2015

Movement of beef remains a struggle coming out of the Thanksgiving weekend. Store space that was recently dedicated to turkeys has

cleared but replaced by pork and poultry. Given the price disparity and the reluctance of retailers to shrink beef margins, this comes as

no surprise. Light CAB® ribs were fully supported as heavy cattle weights have kept product offerings at a minimum. Heavy ribeyes were

not so lucky as prices edged lower. Roast business has been less than expected given the warmer than usual weather around most parts

of the country which has resulted in lower priced end cuts. The loin complex has been weak for some time and price adjustments reflect

that. Not only are strips and short loins lower but there is lack of follow through support for tenderloins, which saw some of the

steepest losses. Even the lowest priced item in the beef case, ground beef, is struggling lower as well.


Ribs remained the shining star for licensed CAB® processors over the past week, but there may not be many days left before the

holidays where values are supported. For the most part, the CAB® complex was under negative pressure as end cuts, thin meats, loin

offerings, and ground beef lost value as demand fell short of clearing packer’s coolers. Major end cut sub-primals such as the inside

round, peeled knuckle, chuck roll contributed largely to lower cutout values. The loin complex saw negative values develop for all CAB®

loin cuts.


Since last week’s report where the rib was sustaining a fairly strong tone, the value of the CAB® rib market is now diminishing. The

calendar became an obstacle for the CAB® rib, as buyers backed away from the market due to shipping logistics. CAB® end cuts have yet

to find a foothold, and both chuck and round values declined. The CAB® loin complex fell victim to lackluster demand, with al l sub-

primal cuts losing value. Thin meats for the past few weeks have received a weak call, leaving spot supplies fully adequate to ample.

CAB® ground beef values held near steady.


The CAB® mirrored much of the commodity beef market. Ribs continued to deteriorate seasonally as last minute holiday purchases have

been complete in the last week. These along with tenderloins, another common holiday item, were the largest losers. It became a little

more complicated when looking at some of the other cuts. Packers usually try to balance the weakness in middles with strength in end

cuts. With the warmer weather around the East Coast, this was just not happening. But as the reporting period progressed, sharply

higher cattle and the threat of a storm in the middle of the country started to change the tone. There was a little more interest for

rounds and chucks. Price adjustments were minimal as early sales were at the lower part of the quote, with later sales towards the

higher end. Strips for the most part were lower but they saw better interest later as well. The price spread to rib eyes could be a

motivating factor. Ground beef near steady.




Urner Barry would first like to wish all a safe, healthy and happy New Year and we thank you for your continued support. We look

forward to a great 2016. What a last week of 2015 it was though. When most thought we would go out with a whimper, the boxed beef

market was rocked by the largest weekly increase in cattle prices since 2003. With the two short production weeks, product was already

limited but packers used both factors to significantly increase offerings. Buyers of CAB® product felt the need to aggressively book

product for the beginning of January needs. Ribs were the only laggards, but expected given the time of year. End cuts were the largest

gainers as buyers positioned themselves for planned roasts features. Volume of clods and insides really picked up that last five trading

sessions of the year. Strip and short loins also were led higher by renewed interest. Seemed the value to ribeyes led buyers to search for

this item. Thin meats were also strong, most notably briskets. The tighter offerings pushed buyers into making sure they didn ’t have a

repeat of two years ago so St. Patrick’s Day business has commenced. Ground beef strong as well.

Certified Angus Beef Market Commentary premiums... · somewhat uncomfortable with current wholesale price offerings. Cattle markets also realized a sharp movement lower with sales

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