What quality pays

USDA reports what a grid netted and what negotiated cash paid in two separate reports and never sets them side by side. Both carry a dressed-basis weighted average for the same all steers & heifers rollup, so this is the same animal, the same week, the same basis.

Grid and formula have both beaten cash by about $2.01 a hundredweight. Formula is the steadier — it beat cash in 64.6% of weeks against the grid’s 56.1%, at lower volatility, for almost the same average. The grid pays a shade more and makes you live with a wider swing.

Forward contracting’s −5.12 is almost entirely the bull market, not the instrument. When cash was rising it came in −9.03 under; when cash was falling it came in +2.71 over. That is what a forward contract is for — it gives up the upside of a rising market, which is the trade it exists to make.

$/cwt dressed against negotiated cash the same week, head-weighted across every row of each basis. 426 weeks in all: 284 with cash above where it stood eight weeks earlier, 142 below. Live and dressed prices are never averaged together — the two bases have to move as a pair or neither figure means anything. These are price comparisons, not margins. USDA publishes no cost side for a feedlot, so nothing here is a profit.

Each row is a weighted average over the head it names, and those groups overlap — a lot appears under both the quality premium and the quality discount when its carcasses graded differently. Last week the quality pair alone covers 346,717 head against a 258,558 head grid. “Share of grid” shows each figure’s reach and is not exclusive. USDA publishes no net, and we do not invent one.

$/cwt carcass, USDA AMS LM_CT145, 5-Area weekly. Grading also pays at wholesale, where the spread is not uniform across the carcass — see the Choice–Select spread by primal. What a shopper pays for a label is a different question again, on the retail page.