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CME: Wholesale Ribeye Prices Impressive in H2/2018

17 December 2018

US - Wholesale ribeye prices have been impressive in the later half of 2018, holding above a year ago since the beginning of August, Steiner Consulting Group, DLR Division, Inc. reports.

Seasonally, ribeye values presented much stronger prices through the third quarter, staging a rally that lasted through the fourth quarter of this year. Rib demand was not limited to Choice grading either.

The primal rib value hit new monthly record highs for the month’s of September, October, and November in Select and Choice graded carcasses.

Branded beef rib primal values set new records for October and November, as well.

Ribeyes weren't the only middle meat cut to show strength this year. Tenderloins were also a bright spot through the back half of 2018 and have rallied stronger than usual this holiday season.

Tenderloins represent a much smaller percentage of the cutout and other loin cuts did not fare as well as tenderloins.

Still, the comprehensive loin primal value gained 2 percent and 7 percent in August and September over 2017. The cutout has responded accordingly.

The third quarter is more commonly supported by the chuck and round. Both these primal cuts were below a year ago this year, and faced stiffer competition from larger supplies of cow beef.

Strong consumer demand for middle meats carried the cutout uncharacteristically during this timeframe.

However, the fourth quarter usually does see support from middle meats and those prices tend to carry the cutout through until the new year.

Consumer demand for these products does not appear to be waning after a strong third quarter, but we would expect to see rib and tenderloin values fall in the first quarter.

It does appear that the demand for ribeyes and tenderloins is related to buying for holiday orders. Beef has been a primary feature this year, and the push has continued into December.

One figure to watch is holiday sales and if retailers sold as much product as anticipated in December.

As evidenced by the graphs below, the rib and tenderloin wholesale prices usually fall in late December after the conclusion of holiday buying.

Daily Livestock Report - Copyright © 2008 CME. All rights reserved.

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