REPORT FARMER S. market trends

Transcription

1 FARMER S REPORT market trends This notice is subject to change. Information printed is based on last received market data. Subject to change without notification US Foods. All rights reserved.

2 BEEF Live cattle traded at $144 last week which is down again from the previous week. More animals are showing up for slaughter and the packers will soon take advantage of this by increasing production which should allow for lower prices. However, sustained cutbacks in slaughter before the Memorial Day holiday has temporarily boosted prices this week. Rounds Insides: Prices continued to fall on insides. There may be some fluctuation in the next week or so, but the market should continue to fall going into the summer months. Flats: Although pricing increased week over week, this trend is not expected to last and should follow the inside round. LOINS thin meats & grinds Flap Meat: Flap meat took a small holiday increase due to lower production levels, but in the next couple of weeks, increased slaughter levels will make product more available. Briskets: Brisket pricing was up slightly week over week, and may have some upward movement until production levels increase. We should see the market fall going into summer. Grinds: Grinds are showing some modest increase due to holiday demand, but we expect this market to decline going into June. Skirt Meat: Outside skirts increased last week mostly due to production cutbacks. Pricing should decline going into summer when slaughter levels increase. Strips: There was an increase in the market as the lower prices enticed some buyers, but the increase was on very low volume. We could still see some gains in the market, but many of the price increases have already occurred earlier this spring. We do not expect the highs of last year as interest for the product is waning. Top Butts: The choice top but market increased ever so slightly from last week. Pricing may fluctuate in the next couple of weeks before we start seeing seasonal decline in June. Ball Tips: Product is readily available and pricing has been declining. Tenderloins: All grades of tenderloins have seen some sporadic price fluctuations, up one week and down the next. Prices are down this week again except select, but we do expect all grades to have some overall downside for the longer term. ribs RibEyes: Rib meat is still seeing some strength moving into peak grilling season. This trend of slighter upside moving through the holiday week and then we should see them move downward modestly. Chucks Chuck Rolls: Chucks saw some strength last week mostly due to lower production, but this trend should only occur for a couple more weeks at best and then we should see the complex weaken going into summer. 2

3 pork Base hog prices traded fairly steady in lighter trade across major markets as packers have purchased animals for this week and buyers are focusing on next weeks needs. Slaughter numbers for this week is estimated at 1.76 million head which is 5% below year ago levels. As we move into the summer season, expect hog supplies to seasonally move lower. Recent reports of major packers reducing their hours due to decreasing animal supplies and lower packer margins have buyers focusing their attention on the weekly slaughter numbers and hog weights. Hog weights have moved slightly lower but remain well above year ago levels. Warmer temperatures should have a negative effect on weight gain and weights are expected to decline during the summer into early fall. Producers continue to feed animals longer (i.e. to heavier weights) to compensate for disruptions in their supply pipeline due to the PED virus. Last week pork prices were moving higher for the loins, butts and spare ribs and trades were reported steady to lower on back ribs. Expect prices to move higher for butts, loins and ribs this week as strong demand from both retail and foodservice support higher prices. Pork prices are expected to trend higher through mid/late June. Supply disruptions late June could support higher prices and volatile markets. Loins The markets for bone-in and boneless loins moved higher on improved retail demand for holiday and early June promotions. Prices are expected to trade steady to higher through mid June as retailers are expected to feature bone-in and boneless pork loins in their weekly ads. tenders Pork tenders moved lower last week as buyers stepped out of the market to access their post holiday inventory levels. Prices are expected to trade steady to lower through mid June then trend higher as retailers plan their July 4 features. Butts Prices for bone-in and boneless pork butts moved higher on increased demand from retailers and foodservice. Prices are expected to gradually move higher through mid June then hold steady to slightly lower through early July. Unanticipated supply constraints could support higher prices. Ribs Spare Rib prices moved higher as demand improves and buyers add to their summer needs. Back rib prices are trading steady to slightly lower on weaker demand. Prices for both spare ribs and back Ribs are expected to trend higher through late June. Warmer temperatures are expected to support higher prices. Lighter spare ribs, St. Louis ribs and back ribs, are expected to remain in limited supply through late June due to heavier hog weights. Bellies/Bacon Bacon/belly prices traded higher last week on improved demand for bacon and tighter supplies of raw materials. Belly prices are expected to gradually move higher through late June then hold steady early July. Supply constraints may create increased volatility and support higher prices. Hams Ham prices continued moving higher last week on strong demand driven by export orders to Mexico and tight supplies of light hams (due to heavier hog weights). Ham prices are expected to trade steady to slightly higher through early June then trade steady to slightly lower through late June. Increased export demand is expected to support higher prices. Trim The following market dynamics will impact finished goods pricing during June. Pork trimmings are starting to decline from their record highs. Processors, while still producing to fill orders, have started to slow down and review their finished product inventory levels. Picnics Pork picnics prices held fairly steady last week on improved domestic and export demand. Prices are expected to trade steady to slightly higher through mid June as processors utilize lean meat in sausage manufacturing and are expected to produce additional items for post holiday retail ads. Demand for exports and unanticipated supply constraints could support higher prices. 3

4 poultry The country has officially entered the summer grilling season, as Memorial Day has passed. The demand was high for all poultry offerings with boneless breasts leading the way. There were shortages of breast meat for all regions of the country, as the boneless breast market continues its upward trend. With many processors closing their plants for the holiday, supplies may be tight again this week. Tenders are in a somewhat similar position. Even though the aggressive buying backed off as the week progressed, sources have reported that out front interest into next week has already absorbed a good portion of the available offerings and at premium prices. Wings for immediate delivery remain thin as this market starts to climb. We ve discovered plenty of purchased loads occurring at levels that are higher than our listed quotations and also a number of bids that have gone unfulfilled. Whole birds and WOGs have settled, at a new record high however. All of the dark bone-in lines finish the week rated steady to full steady. Leg quarters, drumsticks and thighs have been showing signs of strength as we head towards the grilling season. Thigh meat demand remains brisk. Wings Interest in wings is beginning to pick up and the market will slowly rise through the upcoming football season. With the price of chicken tenders being approximately $1.50 higher than the wing market, independent restaurant marketing groups will turn their attention to wings. Boneless Skinless Thighs Retailers are featuring boneless and bone in chicken thighs and leg quarters due to their relative value. Exports of dark meat are up 4% for the year. With this increased demand, the dark meat complex will move up at a slow pace. Even as demand increases, chicken supplies remain limited because producers were slower to expand output than they have during previous periods of improved profit. As we reach the end of May, the number of broiler chicks placed for meat production were changed little from a year earlier, and egg hatchings trail the five-year and 10- year averages, according to USDA data. Boneless Skinless Breasts With the holiday weekend over, this market should tend to move sideways as producers judge their supply to the market s demand. The spread between the market prices of boneless breast and tenderloins is wide enough that breast meat will be viewed as a value. Chicken Tenderloins The chicken tenderloin market has reached an all time high as supplies continue to be in tight supply. This market should slide in the next few weeks as the demand for bone in wings increase. Turkey Boneless SKInless BreastS For the turkey industry, the combination of tight supplies and consistent demand has resulted in a level market closing out the week. The actual amount of negotiated trade has been very light due to the holiday weekend. 4

5 dairy Butter The butter market showed gains again this week. Butter production numbers for April were below forecasts. Inventories remain very tight and are not making up any ground. Butter market is at its highest level since Cheese Cheese markets jumped up again due to buyer interest at the lower prices. The recent drop in prices caused some buyers to buy in unnecessarily which caused prices to run back up. Although prices went higher, we still expect trading to remain within the current range through the summer. Prices are still over 10% higher than year ago levels. Shell Eggs Egg markets are up again this week. Supplies continue to be well balanced across all sizes. Milk/Cultured Milk prices are still at record highs although there has been some relief in fluid milk pricing for the month of June but Cultured Dairy products saw significant increases impacting all segments. commodity grocery Oil Planting conditions have changed quite a bit over the last week. Soybeans have surpassed a 5 year average of 56% planted this time of year. Recently, soybeans have rallied while soy oil has remained in a tight range. Bio-Fuel chatter is sparking some interest in the market. The EPA is targeting September for the release of their preliminary 2015 RFS targets. Surprisingly, the 2014 mandates have yet to be finalized. The lack of uncertainty in the renewable fuel casts a shadow in the trade. Markets tend to like facts and clarity. Market is looking for facts and more data on cancellations, renewable fuel and overall global supply to determine direction. 5

6 seafood Shrimp, Domestic (Whites and Browns) The Domestic brown and white shell on shrimp complex remained mostly unchanged this week. Domestic shrimp brown or white has rapidly dwindling supplies and very little prospect of meaningful replacement in the near term. The Domestic P&D market saw increases on sizes 21/25 and higher. The season closed at sundown May 15th and will reopen in July. The Domestic PUD Market was mostly quiet with this week. Small count PUDs (131 and smaller) maintained a barely steady to weak undertone. All areas are open as of this week with Louisiana opening this past Monday. Shrimp, Latin Central AmerICa (Whites) HLSO white Latin shrimp complex remains unsettled. Supplies are more than adequate for a quiet demand. Importers are reluctant to buy replacement product based on current demand. 31/35-41/50 Latin white shrimp are currently the better buy than same size Asian shrimp with significant savings in the price per lb. Shrimp, Imported (Black Tiger and Whites) TIGER: The HLSO Asian Tiger market were mostly steady this week on mid sizes (16/20-26/30) - those sizes that compete directly with Asian white shrimp. It will be July/August before any large volume of tigers is harvested. The value added Asian Tiger shrimp complex for cooked and P&D was mostly unchanged. WHITES: The Asian White HLSO, P&D tail on and off complexes saw weakening across the board on all sizes. The biggest contributor to this price weakening is a dull demand in the US with many people buying only immediate needs. This does not reflect the replacement pricing from overseas that is firming for 2 reasons: 1) the strengthening of the Indian rupee versus the US Dollar and 2) very little 16/20 and higher sizes shrimp being harvested due to early harvesting this past spring. CatFIsh, Domestic & Imported DOMESTIC: Pricing was stable this week - supplies remain limited. Raw material remains short and is being harvested goes straight to fresh programs. The cold spring prevented feeding and fish growth. Now that the warmer weather is here, the farmers are feeding and they hope to see more volume harvested by end of June, primarily 3/5 size. It will be mid to late July before any significant increase in 5/7 are harvested. IMPORTED: The market is currently stable. Next harvest will be late summer/ early fall and that will be limited based on the amount of fish in the water at this time. Less fish were placed in the ponds by the Chinese in anticipation of the US Farm Bill passing and effectively banning Chinese catfish from being imported into the US. Salmon Chilean Farmed Salmon: Chile exported nearly 100,000 metric tons during January and February, about 17% more than in 2013 for the same time period, with 2/3 of their production destined for Brazil and US. However, with frozen salmon pricing jumping around 77% versus same time LY, Chile may be facing more adversity as we go through the year. The US has been seeking less expensive sources for salmon as soon as the price reached $4.95/lb. Frozen portion pricing is stable this week as supplies remain adequate for a moderate to active demand. The fresh fillet market continues to be stable on most fillet sizes. Supplies are adequate for a moderate to active demand. 6

7 seafood (Cont d) Mahi Mahi The market was stable this week. Sellers are firm on pricing and inventories are below last year s levels. Still a well priced item, Mahi is once again an attractive menu item and demand has increased. With imports balanced better against demand particularly on portions this has caused the price to tick up. This price increase to more traditional levels should hopefully bring some stabilization to the market. Scallops SEA: The market was adjusted lower again this week. Supplies do remain on the light side as the system takes all that is being produced, especially on U10. Pricing is decreasing simply because of an active fishing fleet bringing good volumes to the processors. Prices are still at historical highs. BAY: The market was unchanged this week. Tilapia In light of higher pricing and strong demand, especially out of the US, Chinese farmers are pulling fish out earlier than normally, with the 300/500 gm. fish being predominant. In fact, what used to be standard in the industry in producing 3/5 fillets, i.e., 60% 500/800 gm. and 20% each of 300/500 and 800/1200 gm, the process has changed to 40 to 55% of 300/500 gm, 10% of 800/1200 gm and the remainder comprised of 500/800 gm fish. So what happens to the larger fillets, e.g., 5/7, 7/9 and even 9/11? For the time being, there will be less availability of these sizes putting upward pressure on pricing. Whitefish Complex (Cod, Pollock, Haddock) Cod: Both Pacific and Atlantic were quiet this week. Atlantic Cod quota for 2014 was reduced only slightly from Russia/Norway landed significant volumes during the first 4 months of 2014 with fish sizes similar to Atlantic cod resource is well managed. Expectations are that pricing will rise slightly headed into the summer but overall stable for the remainder of Pollock: The market remains stable on both domestic and imported pollock fillets. The 2014 Bering Sea quota was increased over the 2013 level. Russian quota was reduced slightly from current levels. The Alaskan A season was strong with fish size ideal for fillet production. Russian catch rates also remained high during their latest season. Pricing for balance of this year are anticipated to remain relatively stable. Haddock: The market was steady this week. King Crab The market for red and golden crab is unsettled based on fully adequate supplies and very dull to quiet demand. The sellers of king crab are backing up with inventory which in some cases is leading to price adjustments downward. Tuna, Yellowfin (CO treated) Pricing was stable this week for tuna. Reports out of the west pacific continue to note lower landings which could mean higher prices by mid summer. Crabmeat (Blue & Red, Pasteurized) The market adjusted higher again this week after being quiet last week. The supply is very short on blue swimming crab and red is starting to show signs of tightness as customers flip to red from blue when they cannot get the proper product form in blue. The tight supply will continue through the summer as demand increases and replacement will not be able to keep up with demand. Snow Crab Canada: The largest Japanese buyers are fully committed for the year. Some retailers and more than a few large casinos have placed their orders. 50% + of the Newfoundland crab has been caught as of this week. Alaska: The market adjusted lower on what uncommitted product was available on 8+ and larger in reaction to the Canadian market. LOBster TAIls Warm & Cold water: The market was quiet this week on all sizes of warm and cold water tails. AmerICan Tails: The market continues firm with a tight supply situation. The Canada season has opened and volumes are finally starting to come in but brisk demand is keeping pricing at last season or higher levels. Also increased demand from Asia is keeping pricing strong. 7

8 produce vegetables potatoes Russets: The market for Idaho russet potatoes is becoming tighter for 60- and 70-count cartons pushing up the market. Other size cartons and US No. 2 Idaho russet potatoes are seeing higher prices as well. Idaho prices will remain at these higher levels for the remainder of the storage crop. Harvesting of new crop Idaho russet potatoes will begin around the first week of August. Reds: Demand for red potatoes has been moderate to light and the market has remained steady for the past few weeks. North Dakota is looking to end their storage crop season by the end of the month with the exception of one shipper who is expected to finish in July. Arizona growers are expected to finish shipping their new crop potatoes by May 30th. Harvest in California continues for new crop reds. Reds are also currently available from Florida and Pearsall Texas. Quality has been strong but size has been small on the early digs. New crops will be starting from Muleshoe Texas and North California around mid-june. White, Yellow and Fingerling: Pricing for yellow potatoes is under some pressure from the remaining inventories of storage crop available from shippers in Colo. New crop yellow potatoes are available from growers in Fla., Texas, Ariz. and Calif. With new crop white potatoes available from both Fla. and Calif., the pricing has remained steady. New crop fingerling potatoes are also available from Calif. and Fla. GarlIC The markets for both peeled and fresh garlic are much stronger this week. Prices are expected to get even stronger. Quality varies with pricing reflecting quality. CABBage Cabbage market continues to remain strong. Georgia volume is still moderate with light supply available in Texas. Quality is fair. leaf lettuce Supplies remain very short on green leaf lettuce this week with a possible gap due to record high temperatures. Red leaf, romaine, romaine hearts and butter lettuces have steady supplies. Quality continues to shows internal and external burn in the fields. Shippers are trying to keep damaged leaf out of the pack. Romaine carton will be 37-39lbs per case while Green and Red leaf will be at 22-25lbs per case. Iceberg Lettuce Lettuce supply is light to normal this week with carton weights in 41-43lbs range. Prices are expected to be steady. Quality is an issue and heat related defects will be present in mostly all lettuce packed in California. Onions The onion market has remained relatively unchanged. Demand for conventional onions is light, as Vidalia sweet onions are currently being heavily promoted. There are currently plenty of supplies available out of Texas and southern California. However, transportation continues to be a major problem for Calif. shippers who are looking to ship their crop. N.M. and Northern California growers will also be beginning their onion shipping season as early as the middle of next week. It appears that FOB pricing may remain at these low, stable levels for the foreseeable future. Quality has been very good for onions of all sizes and varieties. ChilE Peppers The chile market is steady with good supply and quality available out of Mexico and Coachella. Squash Heavy rainfall this spring has caused some issue on the Georgia squash crops. Quality is only fair but is improving. Supplies are slowly starting to increase with better volume crossing from Mexico. The market continues to remain strong but look for prices to come off as more supplies become available. Green Beans We are starting to see better supply of green beans out of Georgia. Quality is still mixed due to past rains. 8

9 produce Tomatoes Rounds: Rounds: The spring crop in Florida continues to dwindle faster than expected. Pricing went up sharply as a result of this light supply. More volume will not be coming up until mid June. Quincy and South Carolina crops are expected to start around the 10th of June but volume will not be enough to ease the market completely. Baja California is shipping out 2-layer product that is commanding higher pricing due to limited domestic supply. Cherry and Grape: Grape and cherry tomatoes continue to be increasing in price and demand in Florida. While the rain has prevented a larger harvest, the summertime demand has not dropped off. Baja California has product available, but they have not had any major production yet. Quality out of Baja has been very strong. Mexico is shipping both cherries and grapes, though it has a very low supply for cherries. Romas: Roma tomatoes in Florida had a light supply, met with an equally light demand. Prices should increase over the next week s Mexico comes into lesser supply and demand remains steady. Prices in Mexico are still low. The quality has been very good for the past week and shippers have started to ask for higher prices as a result. This effort will continue for the next week as USA romas get used up for warm weather salsa orders. Cucumbers Cucumbers markets remain strong and supplies continue to be light. Florida production is finished and Georgia production is starting up slowly. Expect this market to remain tight for at least another 7 to 10 days. Quality varies from grower to grower with pricing reflecting on quality. Eggplant Market continues to be steady with moderate supply available out of Florida. Quality is good with no reported issues. Bell Peppers With Florida production projected to be done by next week, bell peppers markets remain strong with a slight increase in prices this week. Georgia production is running behind due to rain issues but, we should see better volume available next week. Quality continues to improve. Carrots Jumbo carrots supplies are lighter this week but the market continues to be steady. Bakersfield is continuing to produce good quality and sized carrots. Celery Celery market is steady. Florida is finished and we are starting to see demand for California products. Prices are expected to be higher due to the increase in demand. Salinas s production will start up in June. Green Onions Growing conditions continue to be excellent and supplies are steady. Expect this market to remain steady with no changes in demand. CaulIFlower Cauliflower supplies are extremely light this week with many shippers still sold out on a daily basis. Prices have come down due to post holiday light demands but are expected to go back up as demand picks up later this week. Quality is good. Asparagus Asparagus market is slightly weaker this week, with demand slightly down during the Memorial Day weekend. Michigan volume is up and Peruvian supply continues to be steady. Quality in all regions is good. Broccoli Broccoli supplies continue to be on the light side. This market is weaker due to post holiday demand being light. Look for this market to strengthen up as demand picks up later this week. Quality is good with no reported issue. 9

10 produce tropical Pineapples The pineapple market is increasing as supplies have decreased from Costa Rica but the quality remains high. Mexico is the opposite with increased volumes but poor quality. Bananas The market is steady as the rainy season in the tropics is almost ended. Demand is steady and the exports are increasing slightly. Avocados Overall, there is good product on the market with sizing running large. The markets are stable due to the volume available. Mexico crop is winding down until mid July then we will be in new crop. California is in full swing with excellent oil content and quality. Peruvian crop is running heavy on 48 counts and larger. Avocados from Peru will be on the market until mid August. Melons Cantaloupes West coast import fruit is completed. The market is strong with a slight product gap on 5-7 counts. California has product but not enough to cover te demand, which is putting further pressure on the Arizona market. Overall, the quality is good with nice internal color. HONEYDEWS The honeydew volumes out of Mexico and Domestic crops are lower than expected. Overall, the quality is very good with good internal sugars. We expect the markets to decrease as the volumes increase in the next couple weeks. Berries Blackberries Mexican import deal continues to have better quality. The weather is very up and down and controlling the volume. Supplies continue to be short as quality with rain has been up and down. Strawberries The strawberry market is decreasing and berries are now smaller in size due to the heat. As the heat wave continues in California the berries will continue to color quickly leading to smaller berries. Santa Maria is past its peak but still has berries. Salinas & Watsonville have good quantities and quality. Raspberries Not much change in the raspberry market as volume continues to build. Still some uncertainty as heat wave last week may reduce some anticipated volume. Blueberries Mexican import deal is almost done due to the rains. Domestic crops in Georgia, North Carolina and California have started. Due to the fact that domestic crop is not in full product yet we are seeing the market increase, as there is not enough product to fill demand. Grapes Coachella and nogales are increasing with supplies which are leading to market decreases. Overall the quality on greens and reds is good with firm fruit. We expect the market to remain steady. The Central Valley will be on the market with product around the end of June. Watermelon The watermelon market has not recovered from the holiday pull and remains limited with product. With the drought situation in California there is concern that this year the market might remain at a higher level. 10

11 produce HANGIng FRUIT Apples Prices continue to increase as demand remains steady but supplies are decreasing. Smaller sized fruit is very short. We are seeing extra market demand on Galas and Fuji s and the supplies are quickly dwindling. Pears The market is unchanged from last week with Washington D Anjou pears still peaking on 80/90 s and 110 s and smaller are very short. There are a few red pears still available but supplies are limited. citrus Lemons The lemon market remains strong with good demand. We are expecting this market to increase almost every week as demand increases and supplies remain limited. Currently we are in district two (coastal region) and many growers are hoping that district 3 (desert region) will have fruit available early to help fill the demand. Oranges The orange market is seeing good demand. Navels will be finishing shortly and Valencia s will be around all summer. We expect the markets to remain at current levels until the end of July, and then we expect the market to start increasing. Many growers have concerns about next year s crop and the drought that California is in, with some acres already being removed. Limes Volumes on limes continue to increase but larger fruit is still somewhat limited. We are now also seeing an increase in demand because of summer. The markets have decreased slightly this week but should be fairly stable moving forward. Quality is very good. 11