USDA Beef Estimates Vs Midwest Steers – 05/14/2021

USDA expects a modest cut in domestic beef supplies per capita in 2021 and 2022. The accompanying scatter study displays Midwest finished steer values as a function of domestic per capita beef supply. USDA estimates steers at  $116 in 2021 and $122 in 2022. Futures quotes for the same period are $10 + premium to USDA forecasts. Traders may believe high grain prices will reduce beef production at a more robust pace than USDA has allowed in their calculations.