The Choice boxed beef cutout value was $197.16/cwt. last week, the second highest weekly average this year and only $1.35/cwt. below the early March peak. Choice values have made a strong rebound after dropping to a weekly low of $177.79/cwt. in mid-April. Currently, Choice boxed beef is 13 percent higher than the same time last year. The latest Select boxed beef weekly average was $185.01/cwt., up 10 percent from one year ago at this time.
The Choice-Select spread has widened sharply in recent weeks, which is the typical seasonal tendency at this time of year. The latest boxed beef values increase the Choice-Select spread to $12.15/cwt., about double the $6.03 spread this time last year. The spread is also above the five year average level of $10.13/cwt. (for this time of year), which represent the first time the spread has exceeded the five year average weekly level since the first week of January. Thus, the Choice-Select spread has gone from a seasonal low in late March of $0.30/cwt. (well below the average seasonal low) to current levels above the average level for this time of year.
What do the increase in both Choice and Select boxed beef values from year ago levels and the widening of the Choice-Select spread in recent weeks tell us about beef market conditions and, in particular, about beef demand? Total beef production is down 2.8 percent so far this year so higher prices would be expected with steady beef demand. Thus, higher boxed beef prices do not necessarily reflect increased beef demand, though they do suggest that demand is holding steady in the face of reduced supplies and higher prices. However, the increase in Choice relative to Select prices does suggest stronger demand for high quality beef. This is borne out in the changing values of various wholesale cuts. At the current time, Choice wholesale values for Ribeye and Tenderloins are up 27 and 24 percent year over year while Chucks and Rounds are up 13 and 6 percent compared to last year.
The increase in wholesale beef prices from year ago levels could be due mostly to reduced beef production so far this year. However, the sharper increase in middle meat values relative to end meat values and the wider Choice-Select spread suggest that beef demand is improving. Wholesale values are expected to increase further with sharper year over year beef production decreases in the third quarter. Continued improvement in beef demand will determine how much higher wholesale beef prices may go.
Source: Derrell S. Peel, Oklahoma State University Extension Livestock Marketing Specialist
Robert Pyper: Reform best the slow way - scotsman.com
RESTRUCTURING Scotland’s public services is a process that should be piecemeal rather than wholesale, and is complicated by the unsettled constitution, writes Robert Pyper
Recent articles on these pages by Professor Stephen Osborne and Des McNulty brought with them a certain sense of déjà vu. It seems as if we are doomed to retrace our steps across a landscape littered with think tank reports, academic articles, parliamentary papers, white and green papers, and associated contributions to the never-ending debates about the future of our public services.
The discussions about inter-agency collaborations, joint service delivery, integrated public services, joined-up approaches and partnership working have a certain circularity. They take place on the assumption that the existing mosaic of public service bodies in Scotland is more or less “a given”, and the task we face is how best to co-ordinate the work of these bodies in order to enhance service delivery. Last year, the Christie Commission devoted a section of its report to matters relating to “inter-agency training to reduce silo mentalities, drive forward service integration and build a common public service ethos.”
In his article, McNulty might justifiably have cited the thorough work carried out some time ago on this theme by the Scottish Parliament’s finance committee under his chairmanship. That committee’s 2005 investigation into “efficient government and civil service reform” gathered a plethora of evidence on the future direction of the public services in Scotland’s devolved polity.
The question of structure, which featured in the 2005 debates, remains germane to the issues and themes covered by Christie, as well as by Professor Osborne and former Labour minister McNulty. Returning to the evidence I submitted to the McNulty Committee, the continuing relevance of the key issues, and the lack of forward movement on the question of the overall structure of the Scottish public services, is striking.
It makes sense to start at the top of the structure, with the civil service. The unified, but broadly federal UK civil service has evolved under devolution to strike a balance between the core principles which emerge from Whitehall and the necessary flexibilities which allow the day-to-day governance of Scotland and Wales to reflect local culture, behaviours and priorities. Since 1997, the prevailing view in Edinburgh has been that there would be little purpose in embarking on the expensive and time-consuming rebranding exercise which would be required in order to create a distinct Scottish civil service. The SNP favours this concept, but apparently prefer to wait for the inevitable break with Whitehall which would result from independence.
What of the relationship between the civil service and the other elements of the public service? In 2005 the head of the civil service in Scotland dismissed the possibility of fundamental structural changes to the organisation and was especially negative about any proposals to bring public sector staff within “a single employment structure”.
That traditional view notwithstanding, it seems that no change for the civil service has consequences for the broader public services, and is not a long-term option. The quest for the type of integrated public service model set out in the articles by Osborne and McNulty has implications for all levels of the system, and will inevitably involve grasping the nettle of structural change. We have already seen how budgetary pressures and financial retrenchment, coupled with fundamental questions about the needs of a relatively small total population, have forced the issue of restructuring in the police service. The move to the “single Scottish force” will not be without its problems, and, of course, in any radical change of this type the major challenge is to ensure that economies of scale and the benefits of enhanced strategic coordination are achieved without loss of vital local accountabilities.
Nonetheless, the direction the rest of the public services are going could perhaps emerge from this case. In 2005 there seemed to be an opportunity to take the system of governance in the direction of an inclusive public service, and arguably facilitate a distinctly Scottish approach to public management and administration within the UK context, regardless of questions about long-term constitutional arrangements. Scottish governance would then be characterised by an approach common in many European states, where the civil service typically encompasses officials at central, federal and local levels. Undoubtedly, a series of legislative and organisational obstacles would have to be overcome in order to create a Scottish public service, but change of this type, properly managed, could help secure service integration, efficiency gains, rational policy-making, clarified lines of accountability, and opportunities to address perceived gaps in leadership or other specialised skills.
How could such a change be taken forward? Two possible routes would be a radical, “big bang” approach or a pragmatic, incremental approach. The former, implying a swift move involving extensive legislative change with only the basic required consultation and experimentation would be inadvisable, and would be at odds with the desire to engender an inclusive, cross-party culture and ethos.
The pragmatic approach would involve establishing key building blocks for reform, developing practices and processes from extant pilot schemes and moving from these to create selected experiments with public service integration, spanning, inter alia, local government, the health service and the civil service. The problem with the incremental building block approach, which features in the sub-texts of the Christie Report, is that we have seen rather a lot of it, over the years. If the “shared services”, “integrated public services” agendas and their associated offshoots are isolated from clearly enunciated commitments to broader strategic reform, they simply spawn a plethora of units and cross-cutting task forces and, ultimately, add to the problem of initiative overload and reform by management fad, from which aspects of the system of government already suffer, without producing the required outcome.
For the pragmatic approach to stand a chance of succeeding, there needs to be a clear balance struck between incremental experimentation and a specific medium to long-term commitment to use these types of building blocks as the basis for the bigger change, the major strategic overhaul of the public services within an agreed timetable.
Professor Osborne argues that constitutional change in the form of independence or devo-max could be the catalyst for long-awaited public service reforms which would link funding and delivery. McNulty questions the need for such macro change as the prerequisite for the required reforms. In 2005 there was no looming independence referendum, and the devo-max agenda, though not described by that term, was about working within the spirit of the emerging Scottish polity and seeing devolution as a “process not an event”.
If a radical reconfiguration of public services could be envisaged in that context, there is no logical reason why such a reform agenda should now been seen as being dependent on major constitutional reform and the outcome of a referendum. However, abstract logic matters little in government, and realpolitik suggests that there will be little significant movement on this reform agenda until the constitutional questions are settled.
• Professor Robert Pyper is head of the school of social sciences, and Professor of Government and Public Policy at the University of the West of Scotland.
Costco Wholesale's Third Quarter Earnings Report - Yahoo Finance
Costco Wholesale (Nasdaq: COST) announced its results for the most recent quarter on May 24, 2012. Costco Wholesale operates membership warehouses that offer a selection of nationally branded and selected private-label products in categories such as food, appliances, and sporting goods, at low prices.
In most situations, when earnings do not meet analyst estimates, a business' stock price will tend to drop. On the other hand, when actual earnings beat estimates by a significant amount, the share price will likely surge.SEE: 5 Tricks Companies Use During Earnings Season
The Numbers:
Costco Wholesale's EPS outpaced analyst estimates while the company's revenues came in below predictions. The company reported 88 cents per share versus the 87 cents per share estimate and revenues of $21.85 billion versus the $22.11 billion estimate. EPS rose 20.5% while revenue climbed 5.9% from the same period last year. Costco Wholesale's revenue has grown during each of the past four quarters on a year-over-year basis. The company's net income for the quarter rose 19.1% to $386 million. Last quarter marked the third in a row of rising net income.
A Look Back:
Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell 1.8 percentage points from the year-earlier quarter to 10.6%. In that span, margins have contracted an average of 0.7 percentage point per quarter on a year-over-year basis.
Net income has increased 10.3% year-over-year on average across the last five quarters. The biggest gain came in the most recent quarter, when income climbed 19.1% from the year-earlier quarter.
Looking Ahead:
For next quarter, analysts have a more positive outlook about the company's expected results. The average estimate for the fourth quarter is $1.29 per share, up from $1.28 90 days ago. Increasing earnings estimate is a positive sign about the company and it typically leads a increase in the stock price. For the fiscal year, the average estimate has moved down from $3.85 a share to $3.84 over the last 60 days.
(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
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