The Premium Market Snapshot is a series of market commentaries focused squarely on trends in quality grading and in the production and sales of high-quality beef. The Premium Market Snapshot is produced in partnership with Drovers/CattleNetwork, and previous Snapshots — “How heifers affect the quality mix” and “Choice/Select spread” — are archived on DroversCattleNetwork.com.
This snapshot explores the production of USDA Prime-grading beef. While, historically, producing a carcass reaching the USDA Prime grade was considered a fluke, the proper alignment of genetics and management is beginning to challenge that idea. In 2010, cattlemen produced an average of 13 million pounds of USDA Prime carcasses per week. That compares to 12.2 million pounds per week in 2009. Packers offered up increasing premiums for Prime-grading cattle in 2010 compared to 2009 in spite of the increases in Prime production — possibly signaling a slight recovery in fine-dining business and high-end beef demand. With the Prime premium averaging $13.43 per hundredweight in 2010, an 800-pound carcass reaching that mark would bring back more than $105 compared to a Choice base.
Mark McCully is assistant vice president of supply development for Certified Angus Beef, LLC, Wooster, Ohio.