The Monthly Cut: Beef Industry Update (June 2017)
For the past two years, beef-buying suppliers and customers have anticipated the rebuilding of the national American beef cattle herd. Overall supply was expected to increase, consequently forcing beef prices to drop. Unfortunately, April, May and June of 2017 has instead seen record high seasonal pricing on many items, including the ever-popular ribeye. These high prices can be primarily attributed to a brief interruption in the number of harvest-ready cattle during the same time that many beef buyers (particularly national grocery chains) were making big commitments for upcoming advertisements – many chose to feature ribeyes and strip steaks. To some, these Memorial Day and Father’s Day campaigns may indicate a sign of economic confidence, however it sure didn’t help those of us who were buying and using these products year-round. As for the better news … the promise of greater beef supply lives on. The number of cattle expected to be ready for harvesting in the next 2 months is far greater than the numbers harvested over the past 4-6 … supply looks to overwhelm demand in the near future, and as we all know, when that happens, prices begin to drop. Perhaps a stronger indication that prices will fall is the lack of forward sales commitments - upcoming large block buys and significant product commitments from purchasers. If buyers choose to not book product weeks and months in advance, it is because they are confident in the supply and are optimistic that prices will soon fall. So hold on, hang tight, we see things getting better. Finally, at Land & Sea, we are happy to be in the midst of steak-grilling, hamburger-eating and brisket-smoking seasons. With a wide variety of traditional and alternative steak cuts, specialty ground beef, and premium meat options for your smoker, call us today! 866-748-8732.