Consumers craving hamburgers, steaks and brisket paid high prices for the beef they purchased in May ahead of Memorial Day. The U.S. Department of Agriculture said retail beef prices rose 22.9% in May, with chuck and round cuts of beef rising 28.7% and 28.5%, respectively.
Ground beef prices rose 16.7% in May to record levels. The Stephens Inc. Commodity Report posted June 16 said this was the largest single-month increase in beef prices. Higher beef prices helped drive food inflation to 4% in May, its highest rate since January 2012, Stephens reported.
The beef index rose 10.8% in May compared to a year ago. Industry sources have indicated higher ground beef prices up 16.7% from a year ago encouraged processors to divert chuck and round into making ground beef, Stephens reported.
Beef packers like Tyson Foods saw an average processing margin of $1,805 per head in May, more than three-fold the five-year average of $526. Live cattle prices rose to nearly $110 per hundredweight in May before tapering down in June. Live cattle prices are down about 7.7% from a year ago. Cattle slaughter was down 1.6% and beef production rose 2.1% in May compared to a year ago.
Pork prices have risen more slowly to just under $3.90 per pound by early May. Packer processing margins improved to $80.10 per head in May, much better than the 5-year average of $30.02. Hog prices are 39% from a year ago and slaughter is up fractionally. Pork production rallied back in May after falling sharply between March and late April from the COVID-19 outbreak in packing communities.
Wholesale chicken prices for boneless skinless breast meat peaked in May at roughly $1.30 per pound, but have fallen to the 95-cent range by mid-June. Breast tenders have risen to $1.20 per pound (wholesale) in early June, from a low of 80-cents in April. The U.S. processing margin for chicken averaged 11-cents per pound in May, which was less than the 16-cent average of the past five years.
According to the USDA, eggs set for the week ending June 6 were 234.4 million, down 0.1% year over year and poultry slaughter remains down from a year ago. In early June poultry slaughter was down 4% the same time last year.