FEWER CATTLE BUT MORE QUALITY BEEF
MARKET UPDATE
By Mary Kurzweil, Analyst CattleFax
Cattle feeding and carcass performance has continued to astound in 2025. This year is on track to exceed last year’ s record-high carcass weights by 20 lbs, driven by ideal feeding weather, low corn prices and high cattle prices that incentivize maximizing each animal’ s potential. More notably, the percentage of fed cattle grading Choice or Prime is poised to set a new record, with Prime projected to hit nearly 11.5 % of fed slaughter.
This strong performance is even more meaningful given the cyclically tighter cattle supply, keeping Prime and upper two-thirds Choice beef relatively available despite overall declining beef production. Through mid- September, fed slaughter is down just more than 800,000 head from year-ago levels, but the number of Prime carcasses is actually running 65,000 head above year-ago. From the 2022 cyclical peak in slaughter to this year, fed slaughter is tracking to be down 2.2 million head, but Prime carcasses will still increase by about 400,000 head. Nearly all the decline is coming out of Select and lower one-third Choice, as cattle have continued to grade better in the past few years.
The shift in quality has been helped by more days on feed this year, but it has been an industry wide trend for the past 20 + years. In 2000, only 55 % of cattle graded Choice or higher; today, more than 84 % of cattle achieve these marks. Producers have accomplished this quality shift through feed and nutrition, optimizing highenergy finishing diets in combination with
advancements in genetics and selection of high-marbling genetics. Strategic use of beta-agonists and other feed technologies has also helped. The more extended days on feed in recent years has allowed the industry to more fully maximize the genetic capacity and feeding management practices already in place.
High-quality beef has been key in the demand resilience that has been seen throughout the year as the growth in beef demand has mainly been for highquality products and ground beef. The consistent supply of high-quality product has given retailers and foodservice operators confidence to promote Prime and Choice offerings, making them more accessible to consumers.
This improved demand has allowed the premiums between Choice and Select, and Prime and Choice to remain strong at the wholesale level, even as there is tighter supply of the lower quality product. The Choice to Select spread is on track to average around $ 18 for the year while Prime is forecast to average $ 42 / cwt premium relative to Choice. This comes back to the cattle producer in the form of grid premiums or discounts based on grading performance.
Bottom line: Strong cattle performance has kept a relatively stable supply of high quality beef, despite tighter cattle supply. This is clearly in line with what the consumer wants as quality premiums have remained strong and beef demand is tracking at record high levels.
More notably, the percentage of fed cattle grading Choice or Prime is poised to set a new record, with Prime projected to hit nearly 11.5 % of fed slaughter. www. NCBA. org NATIONAL CATTLEMEN 21