Cattle Quick Thoughts
The South Dakota state court defamation lawsuit for Beef Products Inc. (BPI) against ABC News settled outside of court this week. This is the suit that alleged ABC published “false and disparaging” statements about BPI’s lean finely textured beef back in 2012. This is the beef that became known as “pink slime.” In reality, it is just 95 percent lean beef trimmings that get mixed in with other trim to make ground beef. In the aftermath of the reporting, BPI’s sales decreased from about 5 million to 2 million pounds per week and they were forced to lay off over 700 workers. BPI sought as much as $5.7 billion in damages while ABC argued that it was protected under the First Amendment and that it never reported the beef was unsafe to eat. The terms of the settlement were not released, but BPI’s attorney said they were “extraordinarily pleased with the settlement” and he believed they “totally vindicated the product.” The North American Meat Institute established a website (available here) dedicated to discussing the safety of leanly fine textured beef and to debunk some common myths.
Cash traded fed cattle prices were lower through Thursday. Live cattle were down $2.86 to an average of $118.65 while dressed steers were down $3.85 to an average of $189.95.
Feeder cash price movements were mixed this week in Mississippi. Mississippi feeder steers weighing 450-500 pounds were down $1 to an average of $150.50 while 750-800 pound steers were up $10 to $137.50. Average feeder prices this week in Oklahoma City were down $3.85 to $172 for 500-550 pound steers and down $6.93 to $148.16 for 750-800 pound steers.
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Futures prices were mostly higher this week. June live cattle were down 10 cents to $119.10 at the close of the contract while August live cattle were up $1 to $116.28. August feeder cattle were up $3.40 to $148.20 while September feeder futures were up $3.95 on the week to $148.35. Corn futures prices were up this week with July and September up 11 and 14 cents to $3.70 and $3.80, respectively.
Boxed beef values dropped off significantly this week. Choice boxes averaged $230.64, down $14.26 from a week ago. This is the largest weekly decline this year. Select boxes averaged $212.83, down $5.93 from last week. The choice-select spread shrunk to $17.81, down $8.33 from last week.
Note: all cattle and beef prices are quoted in dollars per hundredweight and corn prices are quoted in dollars per bushel unless stated otherwise.