Meat Market Update | Longer term forward contracts buoy cutout

Ed Czerwien, market analyst based in Amarillo, Texas, offers a concise summary of how last week's beef trade impacted the cattle market and beef prices.

The Choice cutout continued to decline, but volume was 6,907 loads sold which was 462 loads higher than the previous week. Sales volume has improved lately, after being well below last year since about the first of May. The increased number of box beef loads sold was helped by the longer term forward contracts which are part of the out-front sales. They were much higher with over 500 loads compared to about 80 loads the previous week. The large restaurant chains quite often utilize these longer term forward contracts to protect their menu prices.

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