The five-area direct average steer price last week was $101.21/cwt. on a live basis, according to the Agricultural Marketing Service. That was $1.91 less than the prior week. The average steer price in the beef of $160.66 was $2.41 less.
Cattle futures took a step higher Monday, building on last week’s gains, tied to the outlook for slightly snugger supplies and support from lean hog prices, which appear ready to advance, on South Korea and China banning pork exports from Germany, due to African Swine Fever discovered in that nation.
Live Cattle futures closed an average of $1.20 higher (77¢ to $1.80 higher).
Feeder Cattle futures closed an average of $1.75 higher ($1.50 to $2.02 higher).
Choice boxed beef cutout value was $2.68 lower Monday afternoon at $217.21/cwt. Select was 66¢ higher at $207.76.
After 7¢ higher in spot Sep, Corn futures closed mostly fractionally mixed to 1¢ lower.
After 13¢ higher in spot Sep, Soybean futures closed 4¢ to 8¢ higher.
Major U.S. financial indices closed higher Monday, buoyed by merger and acquisition news, as well as increasing optimism about a COVID-19 vaccine being developed by the end of the year.
The Dow Jones Industrial Average closed 327 points higher. The S&P 500 closed 42 points higher. The NASDAQ closed 203 points higher.
Although food and meat supplies continue to strengthen, following the worst of pandemic disruptions, returning to a balanced marketplace requires an economic recovery that reduces unemployment and revives household incomes, according to Greg Pompelli, director of the Texas A&M AgriLife-led Center of Excellence for Cross-Border Threat Screening and Supply Chain Defense Center. He adds that, given the importance of global markets to U.S. agriculture, the focus will be on returning to pre-pandemic trade levels.
In the meantime, David Anderson, Extension livestock economist at Texas A&M University says the pandemic may prompt a new normal in consumer purchasing practices.
For instance, Anderson points to more delivery services, boxed meals and curbside grocery pickup options as consumers maintain some of their habits from when store shelves and meat cases were bare and people were asked to stay home.
“Another adjustment I think we are going to continue to see over time is more delivery services of groceries and food. More and more of the shoppers in the grocery aisles are employees putting together grocery orders, either for curbside pickup or for companies that bring the order to your home,” Anderson explains.
“Where we see changes at the retail level boils down to human behavior,” Pompelli says. “In the early days of the pandemic, with paper towels or toilet paper, people assumed they wouldn’t be able to find these products for a year, so they stocked up.” Now, he says, consumers are adapting and moving away from their initial reactions as their concerns about food availability diminish.
Prior to the COVID-19 shutdowns, consumers typically purchased about 50% of their food from grocery stores for home consumption and 50% from food services, such as restaurants and schools.
With restaurants continuing to operate at limited capacity and with students recently returning to schools, Anderson explains the food supply chain is still adjusting to the changing markets.