The profit in beef sales is largely wrapped up in special occasions: Thanksgiving, Christmas, Father's Day, Labor Day, Memorial Day. If the industry can just break even from the day in, day out beef sales, the frosting on the cake are the holidays, when the real keeping money comes in.
After all, what is prettier, than that big prime rib coming out to the family dining table on Thanksgiving or Christmas. The other holidays are outdoor grilling occasions, and what goes better on the grill than hamburgers or steaks. Steaks and prime rib are more expensive cuts, with higher profit margins.
This blog is not the only one to take notice of this: the cattle futures market, and the wholesale beef market. Both have gone crazy in the two weeks leading up to July 4, in anticipation of the big beef clearance. Wholesale beef prices this July 4 are up 20% over last year.
Just like bread has five cents worth of wheat in it, according to the return to farmers, not all this price increase finds its way back to the ranch. Packers, wholesalers, retailers--all harvest up more than producers from the better prices. And the better prices could drive some consumers to chicken or pork for their July 4 outdoor cookout.
While not an unmixed blessing for cattlemen, July 4 this year will be just a little merrier.
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