Price Spread Shows
Room For Live Hike

DENVER — The National Cattlemen’s Association’s Beef Business Bulletin reports that there is room in the beef price spread for higher fed cattle prices.

At the time of the latest issue, NCBA found almost a $47 cwt. spread between live cattle prices and those for light boxed beef. That compares to a historic average of $35-40, says NCBA economist Chuck Lambert.

Lambert calculated that with boxed beef selling for $105.60 at that time, fed cattle could be bringing $64-66 rather than the $59-60 they were bringing.

"Packers are making good margins," Lambert opined, "so there is room to negotiate tougher."

(Since then, live prices have slipped to $57, while boxed beef cutouts have increased, widening the spread even further. The chief impediment to "negotiating tougher," it would appear, is that captive supplies remain at historic highs, accounting for half or more of the fed cattle sold. What’s to negotiate? — Ed.)