Agricultural News
Hide and Offal Values in Record Territory This Spring- Helping Cash Cattle Prices Stay Strong
Wed, 11 May 2011 5:50:04 CDT
One of the key components of the strong cash cattle prices we have seen this spring is what the industry calls the "drop credit." According to Erica Rosa with the Livestock Market Information Center out of Denver, this byproduct value is the total value of all non-meat items such as the liver, hide/skin/pelt, and tallow gathered from a slaughter animal. Byproduct values are mostly driven by export markets and have been a factor contributing to higher livestock prices in 2011.
This year the live steer byproduct value as reported by USDA-AMS has been trading at record levels, with weekly values reaching a record high of $13.72 per cwt. (live steer basis) the week of April 22nd. On a monthly basis, byproduct values have increased each month since January 2010, with the average value for March at a record $13.35 per cwt. and $3.25 per cwt. above last year's. Thus far this year, the byproduct value has averaged 33% above a year ago. The driver behind the higher byproduct value is the hide, which accounts for about two-thirds of the total value. As of late-April, the year-to-date hide value was more than 20% above last year, with the value posted in March 25% higher than 2010's.
The drop in the automobile market a couple of years ago hit the hide market hard- but things have improved and hide values have been coming back quickly.
We talk about this part of the beef carcass that has helped push to the highest cattle prices in the southern plains feedlots ever this spring on today's Beef Buzz, as Erica Rosa of the LMIC explains the importance of the drop credit and the price prospects going forward for these by product values.
The Beef Buzz is a regular feature heard on radio stations around the state on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the listen bar below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
WebReadyTM Powered by WireReady® NSI
Top Agricultural News
More Headlines...
