US imported beef prices slide

US imported beef prices moved lower this week, as a result of overseas packers and importers responding to a shift in US fed cattle prices.

The market sentiment concludes that some of the lower prices during the week were due to US end users taking short positions but also as some end users looked for discounted prices after a period of inactivity.

The imported 90CL beef indicator eased US5¢, to US199¢/lb CIF (back AUD19¢ at AUD566.48¢/kg CIF).

Concerns with regard to the increasing fed cattle supplies remain a key point of discussion in the US at present. Forecasts point towards a 24% lift in 120 day fed cattle as of April 1 compared to year-ago levels and a 22% increase as of May 1. Although placements during March are expected to have declined, short term feed supplies remain extremely large. If marketing rates do not keep pace, fed cattle prices will come under pressure later in the year.

Demand in the US seasonally picks up heading into grilling season however; the impact of a cold spring in a number of key metro areas presents some uncertainty.

Highlights for the week ending 13^th April:

• US fed cattle slaughter was lower than expected this week as adverse weather caused packers to cancel Saturday shifts.

• Steer and heifer (fed) cattle slaughter for the week was estimated at 478,000 head, only 0.3% higher than a year ago. In the last six weeks US fed cattle slaughter is down 0.3% year-on-year, at a time when on feed supplies are almost 9% above last year.

• Non-fed cattle slaughter for the week was 127,000 head, 12.9% higher than a year ago as drought and low dairy prices have pushed more beef and dairy cow slaughter to market.

• CME futures were higher this week following a modest recovery in the spot cattle market and colder than normal weather.

Click here to view the Steiner Consulting US imported beef market weekly update.