Beef: Producers and packers reverted to waiting until Friday to get cash cattle sales going. Producers in the South were able to get back the dollar they lost during the prior week, with the bulk of sales at $128/cwt. live. Dressed sales in the North were reported as high as $208, up to $4 higher than the prior week. The average on the Choice cutout advanced by more than a dollar last week, while the Select cutout was steady to weak, further widening the Choice/Select spread. There were advances on the Choice middle meat primals, while the primal values of the Choice end meats remained steady. Following the recent weather disruptions, the cattle harvest rebounded sharply higher last week, reaching an estimated 631,000 head. This was 34,000 head larger than the prior week and 20,000 head above a year ago. Beef production was estimated at 509 million lb., up 5.4% from the previous week and 2% larger than last year.
Pork: The cutout was slightly stronger than anticipated last week as harvest disruptions supported primals better than forecasted. The peaks could certainly be in, with the discussion now turning to how quickly the price can come off. Hams and bellies pushing higher may be limited, but the live animal delivery disruptions may not normalize enough this week. The cutout forecast calls for weakness, but support could be in play for another week. Look for prices to take off half of March's gains during April on the supply. This could certainly change if the U.S. Department of Agriculture's “Hogs & Pigs” inventory report this week contains surprises for either side. The continual gains from current levels are not in the forecast unless exports packages are being set aside, not known but not in the forecast for the next few weeks.
Poultry: The broiler cutout valuation for the week ending March 15 that was based on USDA values of line run breast meat, wings and leg quarters averaged 84 cents/lb. It was the highest the weekly weighted average has been since the final week of September in 2017. Elevated wing and leg quarter prices were primary drivers. For wings, participants have been expecting stronger supplies and reliance on boneless wings as a supplemental disappearance driver to allow for some settling to occur; however, the industry narrative has remained bullish in recent weeks, despite January wing ending stocks being up 5.1% from a year earlier. With two full weeks left until the culmination of college basketball tournaments, though, there is still ample time for wing orders to eclipse availability. The broiler cutout is projected to be up 2.8% from a year ago during March and up 0.6% from the prior year during the first quarter overall. Headwinds from competing proteins are projected during the second quarter, when a 0.5% drop from the prior year is expected to occur.
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