Slaughter weights, and the effect they have on beef supplies, play an important role in the beef market economy. Coming into this fall, there were signs that heavier slaughter cattle could push supplies beyond what market demand could bear.

Weights have been heavy, but it appears that consumer demand has kept pace, and higher prices at the fed-cattle level have encouraged feedyards to market their cattle in a timely manner. Economist Wayne Purcell, at Virginia Tech, says "I believe we have skirted past the dangers of getting caught holding cattle hoping for better prices and moving weights and tonnage up to burdensome levels. Demand continues to look good. The demand index I've calculated and maintained for the industry is showing third quarter demand up 10.5 percent since 1997."

The Livestock Marketing Information Center reports that cattle dressed weight averaged about 15 pounds, or 2 percent, above a year earlier during late October. Fed steer and heifer weights typically peak around that time period, according to LMIC, but a seasonal increase in cow slaughter usually pulls the overall average down. This year, average dressed weights have held fairly steady since August. This, apparently, is due to a decline in cow slaughter, with steers and heifers making up a higher percentage of the slaughter mix, compared with two years ago. In addition, dairy cows have accounted for much of the cow slaughter in recent months, resulting in higher average weights.

Dr. Purcell stresses that although boxed-beef values have been running lower than some years, consumer demand is strong. "You really only test the strength of demand at the consumer level, where the buyer has to decide whether to take the product offering at the listed price. At that level, we have seen generally higher prices and prices up enough to more than offset inflation in the presence of increased quantity taken. That is a textbook indication of improvement in demand."