Page 18 - MWC 10-5-2023s

In the Cattle Markets The Midwest Cattleman · October 5, 2023 · P18

By Elliott Dennis, Extension Livestock Economist, University of Nebraska – Lincoln

High Culling Continues meat/fat blends such as the these higher prices. about $5 per pound whereas
to Occur traditional 80/20 (i.e., 80% Trying to determine what the MDM WTP is estimat-
The annual fall feeder meat, 20% fat). Beef trim- the upper ceiling consumers ed at approximately $8 per
run is about to begin. Given mings from the domestic would pay for ground beef pound. It will likely not go
cattle prices, forage condi- market consist of about 70% is hard to say. Comparing that high as there is almost
tions, and the economy the of all beef trimmings used. the Meat Demand Monitor always a gap between what
question of whether heifers The remaining 30% comes (MDM) willingness-to-pay consumers say they will pay
will be retained to rebuild from imports. (WTP) vs. current retail and what they actually pay.
the beef cow herd remains The percentage of beef ground beef prices indicates They will also substitute
uncertain. Consider these trimmings from steers and that ground beef prices could with other meat products,
factors that give pause to heifers is much more stable continue to rise another lowering the quantity de-
whether this expansion will than cows/bulls since the $2-3 at retail. Current retail mand for ground beef. But
occur with as much momen- latter tends to move lock- prices for ground beef are the fresh 90% ground beef
tum as we might think. step with the cattle cycle.
Imports and trimmings
Retail and Wholesale from bulls and cows tend to
Ground Beef Prices substitute for each other. As
US consumers love eating of recent, 75 percent of all
ground beef. Ground beef is beef imports are beef trim-
primarily made from beef mings mainly coming from
trimmings. These trimmings Australia and Brazil. How-
can either come from the do- ever, this has dramatically
mestic or import market. In dropped off in the last year
the domestic market, trim- to 65% and is almost entire-
mings come from fed cattle ly due to a reduced amount
(steers and heifers), bulls, of beef trimmings being im-
and cows (dairy and beef). ported – down about 500
Fed cattle have more fat million pounds. This has in
than bulls and cows, so meat part led to higher prices for
processors use trimmings ground beef at retail. But
from both to create different consumers are still paying