Revised Price Spreads for Beef and Pork

In recent years, several industry groups and the National Commission on Food Marketing have questioned the accuracy of price spreads for beef and pork, as published in this situation report. Their main question was whether weekend specials were fully considered in the computation of average retail prices. Computations included some of the effect of specials, but did not fully allow for the extra volumes sold at special prices. As a result of a complete review of all procedures, a considerable number of revisions have been made to more accurately compute price spreads for beef and pork. These include the effect of price specials, an adjustment for retail shrink, use of carlot wholesale prices, and changes in the computation of byproduct values. Some of these revisions tend to narrow the estimated spreads while others tend to widen them. This article is in conjunction with publication of the revised series. The price spread series for both beef and pork have been revised back to 1949. The revised series, in their entirety, on a quarterly basis will be published in a bulletin in the near future.