Beef prices declining as 2016 grilling season approaches

Memorial Day is the traditional start to the summer grilling season, and beef is one of the most popular grilling items. Conditions in the livestock markets have changed considerably over the past year and suggest lower beef prices through the summer months. Historically heavy slaughter weights coupled with larger-than-anticipated cattle slaughter volumes in late April and early May have driven beef supplies higher and pushed wholesale beef prices lower. At the same time, soft demand for ground beef products and the popular beef “middle meat” grilling items—such as ribeye and sirloin steaks—ahead of the grilling season has kept prices under pressure. The Choice cutout value—a common indicator of wholesale prices for beef graded as Choice—for the week ending May 6 was $205.72 per hundredweight/cwt, down nearly $17 from the first week of April and almost $51 lower than the same time last year when supplies were much tighter. These lower wholesale prices should translate to lower foodstore prices, but the degree to which retailers feature beef in June and July will depend on demand as well as the market conditions for pork and chicken. This chart is based on the Livestock, Dairy and Poultry Outlook report, released May 16, 2016.