It is the difference in the price of hanging beef that grades choice and beef that graded select. It tells you if you should continue to feed cattle in an attempt to make choice or just market them in condition that would be graded select.
Found this thread when searching the topic, the current spread is $22.72/cwt. https://www.ams.usda.gov/mnreports/lm_xb403.txt
This would indicate a shortage of choice grade cattle?? I assume this is due to cattle being marketing at younger age/lighter weight so that the feeder can minimize losses?? Just curious on peoples' thoughts with more knowledge on this than me.