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USDA Issues Correct Livestock Mandatory Price Calculations

WASHINGTON — On May 23 at 4:30 p.m. EDT, the U.S. Department of Agriculture's Agricultural Marketing Service (AMS) released corrected Choice and Select boxed beef cutout and primal cut values for April 3 through May 11 in the National Daily Boxed Beef Cutout and Boxed Beef Cuts report. On May 14, AMS discovered a technical error in the computer program for the livestock mandatory price reporting (LMPR) system. The error affected the cutout values for beef carcasses and primals (the major components of carcasses). The cutout and primal values are constructed from the prices of individual meat cuts which have been reported accurately and were not subject to the programming error.

Corrected calculations for the daily Select cutout values for the period April 3 through May 11 averaged $0.43 or 0.37 percent higher per hundredweight than the values originally reported, ranging from a one-day low of -$1.10 to a one-day high of $1.94. The Choice cutout values averaged $2.92 or 2.32 percent per hundredweight higher, ranging from a one-day low of $0.73 to a one-day high of $7.54. Choice and Select boxed beef cutout and primal cut values reported since Wednesday afternoon, May 16, have been correct.

An internal review team appointed by Secretary Ann M. Veneman and headed by Keith Collins, USDA's chief economist, has reviewed the process for recalculating the cutout and primal values. The team will continue to monitor this process while conducting an in-depth review of the entire LMPR program to ensure the integrity of the system and the accuracy of future reports.

The National Daily Boxed Beef Cutout and Boxed Beef Cuts report containing the recalculated cutout and primal values may be accessed at: http://www.ams.usda.gov/mnreports/lm_xb403.txt.

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