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Declining prices impact feeder cattle numbers

Cattle Market Wrap Up with Ed Czerwien

Feeder cattle numbers dropped at the test auctions after last week’s big decline in prices with 35,400 head, which was still a good run and higher than last year. Prices started to improve on the yearlings as the CME rallied and were better as the week progressed.

Slaughter cow prices starting to climb higher, helped by improving cow meat prices which jumped quite a bit because of grilling demand for hamburgers. Slaughter cow numbers at the auctions are starting to take the normal seasonal decline which takes place every year when cows are turned out on pastures.

Beef quality matters: Top end of market gaining market share

Branded beef sales

Over the years, this column has repeatedly focused on the importance of beef quality to consumers and the subsequent impact on beef demand. Perhaps that discussion has never been more significant than right now, given where we are in terms of market dynamics.  

During the first three weeks of May, the boxed beef market has established some new milestones. The aggregate of Prime and branded sales represented approximately 26% of all boxed beef revenue. That’s because total dollar generation has surged from the two categories. And the week ending May 18 witnessed Prime and branded sales totaling nearly $160 million!

Meanwhile, the 52-week average is now running around $114 million – that’s also a new high-water mark. In other words, May’s market action isn’t a seasonal flash in the pan; as evidence by this week’s illustration, this is a long, enduring, relentless trend. 

All this confounds conventional wisdom. In general, as a product (e.g. high quality beef) becomes less scarce, it should be worth relatively less over time. But the industry continues to produce more high-end product – and premiums for that product have remained surprisingly stable. 

Demand is the differentiator. Consumers are sending the signal they desire Prime and branded products and the market is able to clear that product in easy fashion.

What’s your perception of these market signals? How much market share can Prime and branded products ultimately garner across the beef complex? What changes have you made, and/or are making, to adapt to the changing beef market environment? Leave your thoughts in the comments section below. 

Nevil Speer serves as an industry consultant and is based in Bowling Green, KY. Contact him at [email protected]

MIDDAY Midwest Digest, May 24, 2018

Weather forecasters are pointing to heat for the holiday weekend. 

Mount Rushmore is getting an upgrade. The carvings won't be touched, however. Construction will be mostly overdue maintenance.

Max received an enthusiastic offering of flags when requested via his Twitter account.

Meat Market Update | Memorial Day sales wrap up

Meat Market Update with Ed Czerwien

As Memorial Day sales wrap up, the cutout reacted accordingly and slowly declined. The daily spot Choice box beef cutout ended the week last Friday at $232.21 which was $1.24 higher compared to previous Friday but then it topped out and started to drop a little which is normal when the Memorial Day sales have been completed. However, last year the daily Choice cutout was $247 and also leveled out after the big rally.

The daily Choice Rib primal finished the week on Friday up $16 dollars at $396 which alludes to continued strong demand for grilling. We saw a very good grilling rally this year, but just not quite as high as last year. It is still great and it normally continues toward Father’s Day along with the Fourth of July.

Move over kale; steak is the new superfood!

Ryzhkov / ThinkStock A perfectly grilled steak

Despite the decline in beef consumption in recent decades, America’s favorite protein is still a punching bag for many of our nation’s health woes. From cancer to diabetes to heart disease and more, everyone loves to point the finger at beef and ignore the fact that this product is a nutritional powerhouse packed with zinc, protein, highly absorbable iron, B vitamins and brain-fueling saturated fats.

Yet, this misguided rhetoric is complete white noise when we begin to look at diets that avoid animal fats and proteins altogether.

In a recent article from The Telegraph, Sarah Knapton studies the long-term effects of vegetarian diets. Her conclusion — going meatless can lead to genetic mutations that raise the risk of heart disease and cancer.

According to the article, “Populations who have had a primarily vegetarian diet for generations were found to be far more likely to carry DNA which makes them susceptible to inflammation. Scientists in the U.S. believe that the mutation occurred to make it easier for vegetarians to absorb essential fatty acids from plants.

READ: Dietitian debunks veggie burger as a health food

“But it has the knock-on effect of boosting the production of arachidonic acid, which is linked to inflammatory disease and cancer. When coupled with a diet high in vegetable oils - such as sunflower oil - the mutated gene quickly turns fatty acids into dangerous arachidonic acid.”

Knapton referenced previous research that found vegetarian populations are 40% more likely to suffer colorectal cancer when compared to meat eaters. The study comes from Cornell University, which compared the genomes of hundreds of vegetarians living in Pune, India to traditional meat-eating people in Kansas. The contrast in genetic differences was significant.

“Those whose ancestry derives from vegetarians are more likely to carry genetics that more rapidly metabolize plant fatty acids,” said Tom Brenna, professor of human nutrition at Cornell. “In such individuals, vegetable oils will be converted to the more pro-inflammatory arachidonic acid, increasing the risk for chronic inflammation that is implicated in the development of heart disease, and exacerbates cancer. The mutation appeared in the human genome long ago, and has been passed down through the human family.”

READ: 8 business moguls committed to putting you out of business

In other words, while we’ve been told for years to eat less meat and more salads, maybe we need to reverse our thinking.

Not only can a vegetarian diet lead to increased chronic inflammation, researchers are discovering that the mutation of the genes also impacts the production of omega 3 fatty acids, which are protective against heart disease.

On top of it all, Knapton says a vegetarian or vegan diet can lead to fertility problems by lowering sperm counts. And looking at our overall health, when someone decides to go meatless, they are also committing to a lifetime of pill popping, as supplements will be needed to obtain the proper nutrients to thrive.

According to Knapton, “Many vegetarians also struggle to get enough iron, vitamin D, vitamin B12 and calcium, which are essential for health. One study found that vegetarians had approximately 5% lower bone-mineral density (BMD) than non-vegetarians.”

I’m sure I’ll get plenty of vegans and vegetarians writing in to contradict these new findings; however, I’m pleased to see more research coming forward that exhibits the importance of meat in the diet. Move over kale; steak is the new superfood!

The opinions of Amanda Radke are not necessarily those of beefmagazine.com or Farm Progress.

MORNING Midwest Digest, May 24, 2018

It's going to be hot and humid this Memorial Day weekend.

Retailers are trying to revive business with "shop crawls," offering amenities like cocktails, coffee and even yoga.

A new bill has been introduced to provide more tools to USDA to help better the accuracy of the Drought Monitor.

A former airport manager in Michigan has been indicted for bribery and kickbacks. He may have eaten evidence.

Farm Progress America, May 24, 2018

Max Armstrong offers some history of the Drought Monitor, which has been around since 1999 and it is increasingly becoming a tool used by more people - including policy makers. Max talks about the map and its history, including how USDA uses the information to trigger support for some programs.

Farm Progress America is a daily look at key issues in agriculture. It is produced and presented by Max Armstrong, veteran farm broadcaster and host of This Week in Agribusiness.

Photo: stevanovicigor/iStock/Getty Images

MIDDAY Midwest Digest, May 23, 2018

We're learning more about Miss USA, from Nebraska. 

Susan Bayh is recovering from brain cancer surgery. She's the wife of Evan Byah.

Neglected horses from Iowa are recuperating.

Farm bill could be back up for passage during the third week of June.

MORNING Midwest Digest, May 23, 2018

Gas prices have been climbing over the last few months. It's 60¢ a gallon higher than a year ago.

This fall, Missouri voters will be asked if they want another 10¢ per gallon increase to help pay for road repairs in the state. 

Rains in the plains states have been too late to help the wheat crop recover. It's rated only 36% good/excellent overall.

A wrong command was given on a freight vessel before it nearly slammed into a sea wall in Michigan. It was a close call.

Farm Progress America, May 23, 2018

Max Armstrong offers insight into what factors are driving the major mergers between large farm input companies including the purchase of Syngenta, the merger of Dow and DuPont and the marriage of Bayer and Monsanto. Max looks at the costs driving these big deals.

Farm Progress America is a daily look at key issues in agriculture. It is produced and presented by Max Armstrong, veteran farm broadcaster and host of This Week in Agribusiness.

Photo: metamorworks/iStock/Getty Images