Boxed beef prices continue to drop as packing plant capacity chews through the backlog of heavy weight cattle. Loewen and Associates Market Analyst Matt Hines says there is growing concern that drought conditions in parts of the U.S. could send even more cows to slaughter. “This is typically summer grazing time, but it’s forcing some to feed hay and place heifers in feedlots and some cows heading to slaughter,” says Hines. “We definitely don’t need that with additional beef supplies. We still have probably more than one million slaughter weight cattle to get through.” Packing plant capacity is running very close to levels before COVID-19, but capacity will need to go even higher to catch up on the backlog of cattle. “It looks to be close. The problem is if slaughtering 120,000 head of cattle per day is average, how do we catch up on one million head? We need to be pushing at least 130,000 to 140,000 head. That’s a lot of beef.”
