Cattle herd rebuilding means lower margins for packers like Tyson Foods

by Kim Souza (ksouza@talkbusiness.net)

Lower beef packer margins for Tyson Foods and other processors will continue as the U.S. beef cattle herd rebuilds, according to Derrell Peel, livestock marketing analyst at Oklahoma State University Extension.

Packers like Springdale-based Tyson Foods lost about $10 per head on the beef they processed for the week ending June 3. The loss per head widened from $5 per head the prior week. Packers profited about $87 per head a month ago and $265 per head a year ago, according to Sterling Beef Profit Tracker.

Packer margins are being squeezed by higher live cattle prices driven by fewer cattle supplies which has pushed processing capacity utilization down to 79% in recent weeks.

https://talkbusiness.net/2023/06/cattle-herd-rebuilding-means-lower-margins-for-packers-like-tyson-foods/

Sizzling Summer Beef Demand Pushes Prices Higher

by Kim Souza (ksouza@talkbusiness.net)

Beef prices typically increase following Memorial Day with more summer grilling demand but prices this year are trending higher than a year ago, according to Derrell Peel, livestock marketing specialist with Oklahoma State University Extension.

Peel said the seasonal increase in boxed beef cutout prices is higher than usual this year, with the weekly average “Choice” boxed beef prices rising 63.8% from early January to early June. Prices were higher across the board with loin cuts increasing 93%, rib meat up 60%, round rising nearly 44% and chuck cuts up 39% from the same period last year.

Year-to-date, values range from a 17% increase in rib meat for cuts like cowboy steaks and prime rib roasts to a 110.8% rise in short plate meat which includes skirt steak used in fajita and short ribs. Peel said the slight decrease in prices toward the end of June do not indicate weakening demand, but rather that food service operators had largely replenished their supply by early June.

https://talkbusiness.net/2021/07/sizzling-summer-beef-demand-pushes-prices-higher/

Wholesale “choice” boxed beef prices are up 40.7% through the end of June, compared to a year ago. (photo courtesy of Oklahoma State University Extension)