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 $146, steady with the previous week. Slaughter levels are still curtailed, but should increase as more animals are available for slaughter allowing more available inventory at better price levels. ROUNDS INSIDES: Demand for inside rounds has fallen and pricing has as well. We will continue to see the insides drift lower going into July. FLATS: Same as the inside. LOINS STRIPS: Unexpectedly, choice strips are not following seasonal demand in front of Memorial Day. If there are any increases in price over the next several weeks, they would be modest at best. Most 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: Week over week the choice market is holding fairly steady - up slightly one week and down slightly the next. This may be true for the next couple of weeks and then show signs of seasonal decline. The select has started to indicate signs of downside in the future. BALL TIPS: As we see production levels increase, we are seeing a moderate decline in price. This trend should continue. RIBS RIBEYES: Rib meat is still seeing some strength, but mostly called stable as we move into peak grilling season and holiday demand. This trend of slighter upside than down should continue through May. CHUCKS CHUCK ROLLS: Chucks are steady at this time due to the interest in grinds and the corresponding higher price for trim. This trend should only occur for a couple more weeks and then we should see the complex weaken after Memorial Day. THIN MEATS & GRINDS FLAP MEAT: The market is called barely steady as production levels start to increase. BRISKETS: Brisket pricing is starting to fall as forward orders have been delivered. GRINDS: Grinds are showing some modest increase going into Memorial Day, but we expect this market to decline going into June. SKIRT MEAT: Outside skirts are starting to show early signs of downside as the production levels start to increase. TENDERLOINS: All grades of tenderloins have seen some sporadic price fluctuations, up one week and down the next. Prices are down this week, but we do expect all grades to have some overall downside for the longer term. 2

3 PORK Base hog prices traded steady to slightly lower across major markets as packers have secured their needs for the week and will start focusing on next weeks needs. Currently, weekly slaughter estimates are holding steady at the 2.0 million head level. While this is still 3.5% lower than year ago levels, it is higher than expected and has increased the anticipated amount of pork available for sale this week. As we move into peak demand season, packers express their concern on live hog supplies during the summer and fall time frame. Hog weights remain heavy but are steady week over week. Warmer temperatures are expected to have a negative effect on weight gain. Thus hog weights are expected to continue moving lower through the summer, but remain above year ago levels. Producers continue to feed animals longer (i.e. to heavier weights) to compensate for disruptions in their supply pipeline due to the PED virus. Overall pork prices were mixed last week as ribs and hams moved higher and the loin complex and pork butts lost value. Pork prices are expected to firm up and begin trending higher through mid June. LOINS The markets for bone-in and boneless loins moved lower on continued weak demand. Prices are expected to move higher late May through mid June as retailers are expected to feature bone-in and boneless pork loins in their Memorial Day and early June ads. TENDERS Pork tenders moved lower last week as retail buyers stepped out of the market to assess their inventory levels. Tenders were heavily promoted in early May and are expected to be featured in Memorial Day ads. Expect prices to begin moving higher next week through early June. BUTTS Prices for bone in and boneless pork butts moved lower last week as unanticipated supplies flooded the market. Prices are expected to gradually move higher through early June then hold steady to slightly lower through late June. Unanticipated supply constraints could support higher prices. RIBS SPARE RIBS: Spare rib and back rib prices moved higher as demand improves and buyers add to their summer needs. 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 Spareribs, 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 held steady last week as demand for bacon starts to pick up a bit. Belly prices are expected to begin gradually moving higher during May as processors add to their freezer positions and retailers add promotional features later in the month. Prices are expected to continue trending higher through mid June. Supply constraints may create increased volatility and support higher prices. HAMS Ham prices took a counter seasonal move higher last week on strong demand driven by export orders to Mexico. Ham prices are expected to trade steady to slightly higher through May then begin trending lower through mid/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 Memorial Day orders, have started to slow down and review their finished product inventory levels. PICNICS Pork Picnics continued their downward trend last week with additional declines early this week. Processors began utilizing frozen inventories which left fresh product on the market. Picnics are expected to trade steady to lower through May then hold steady early June. Demand for exports and unanticipated supply constraints could support higher prices. 3

4 TURKEY BONELESS SKINLESS BREASTS Once again, the fresh boneless Tom turkey market increased this week, though the frozen market was flat. Both markets continue to set Urner Barry records for the highest price in their history. There are no indications, with the limited supply of turkey, that this market is near its ceiling. POULTRY Chicken has become the meat protein of choice by many consumers due to the relatively low price. Major restaurant chains, regional restaurant chains and independent restaurants have turned all of the marketing attention to chicken. With the added demand for chicken, the poultry industry needed to bolster their supply. However, with a colder than normal winter, a butane fuel shortage to keep rural farms warm and the catastrophic spring storms, the only growth in the poultry business can be attributed to the jumbo birds weight getting heavier. The tornado damaged the supply of small, fast food sized birds the most. As a result, the Georgia Dock market on this bird has hit an all time high, and is expected to continue trending higher. The popular sized boneless breast will have to be cut out of jumbo birds, resulting in more chicken trim and less whole breast meat. Small wings and select 1 oz. tenderloins will remain extremely difficult to source. So, how does this affect us, the consumers? It appears that the chicken market may not follow the normal trend that it has followed for years. The poultry market normally rises in the spring, peaks at the end of May or the first of June, and then follows a slow steady drop in prices until the bottom is hit near the end of the year. Experts are predicting the prices will peak in June, and then follow a steady sideways trend into fall. The market will not bottom out unless the poultry industry decides to accelerate the amount of birds made available for slaughter. COMMODITY GROCERY CHICKEN TENDERLOINS The chicken tender market also made steady gains this week. The select tenderloin is selling, when found, well above listed prices. Jumbo tenders are being cut down into smaller sizes to cover QSR further processed products. Market prices will continue to rise into June. BONELESS SKINLESS BREASTS The boneless breast market moved up this week on availability issues. The grilling season arrived this past week, with spring-like temperatures throughout most of the United States. This market will continue rising through Memorial Day. WINGS The wing market did dip slightly at the beginning of this week, but started showing strength during the current week. Look for the wing market to start rising in June and continue a steady climb into the football season. BONELESS SKINLESS THIGHS The boneless breast market gained slightly this week, mainly attributed to export demands. Retailers have started to promote this product for the grilling season, making boneless thighs the most affordable meat protein on the market. OIL Weekly soybean export sales were reported right near the middle of the trade estimates. Although export sales are right in line with expectations the US balance sheet remains tight, as beans are becoming harder to find. Last week US soybean planting was at 5% which is below the 11% average for this time of the year. The weather has played a role in current plantings. We are expecting some dry weather over the next week and this should pick up the planting progress. Market has more upcoming data to digest that will help determine its next move. The Blenders Tax credit appears to be coming into play, and this could have a major effect on the bean supply. 4

5 DAIRY BUTTER The butter market continues to rise as butter is currently considered the tightest product across the US Dairy Market. Higher than expected exports coupled with lower than expected production continues to drive concerns regarding tight inventories. CHEESE Cheese has started to see some downward pressure but markets are still 18% higher than year ago averages. Demand is still good, and export demand was higher than expected which should support prices at their current level, at least through the end of Q2. Dairy markets overall have been at record high levels for all of 2014 and it has been evident in category growth. SHELL EGGS Egg markets are up slightly again this week showing that we have likely hit the historically low point for the year. Supplies continue to be well balanced across all sizes. SEAFOOD SHRIMP, DOMESTIC (WHITES AND BROWNS) The Domestic brown and white shell on shrimp complex was relatively quiet 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 was also quiet. The exception to this trend is the larger sizes of U 10 and 12 browns and whites these seem to be slightly weakening due to dull demand. The season closes at sundown May 15th and will reopen in July. The Domestic PUD Market was mostly quiet with some weakening on sizes smaller than 151/200 ct. This continued weakening is in anticipation of the opening of the Gulf season with smallest sizes being caught first processors are clearing out any product that may still remain before the season starts. However, the opening has been delayed due to colder weather. SHRIMP, LATIN CENTRAL AMERICA (WHITES) HLSO white Latin shrimp complex continues to show weakness across the board. Supplies are more than adequate for a very dull demand. Importers are reluctant to buy replacement product based on current demand, which in turn is starting to bring the replacement market down. 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) The HLSO Asian Tiger market weakened this week on very large sizes (8/12 and larger) and those sizes that compete with Asian white shrimp (21/25 & 26/30). 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 weakened across the board. 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. CATFISH, DOMESTIC & IMPORTED DOMESTIC: Pricing was stable this week based on strong demand and limited supplies. 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. IMPORTED: The market was stable after a large increase last week. Little to no product coming from China right now and dwindling inventories in the US. 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. Chinese processors are all ready looking for projections against this next harvest. 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. 5

6 SEAFOOD (CONT D) SCALLOPS SEA: The market continues to adjust downward slowly as the scallop boats are starting to bring good volume to the auction. Prices are still at historical highs. Inventories remain limited. BAY: The market saw a slight upward adjustment on CHINESE Bay scallops in the 120/150ct size. Inventories are tight on this size as the harvest was limited and much of these smaller sizes stayed in China for domestic sales TILAPIA The tilapia market was stable this week. 7/9 size remains very tight in the market place and harvesting on this size will not be until August/September. In regards to other sizes, we will not see increased harvest in China until July which means that product will not be to the US until late August. SALMON CHILEAN FARMED SALMON: Frozen portion pricing is stable this week as supplies remain adequate for a moderate to active demand. The fresh fillet market continues to trend slightly higher on all fillet sizes. Supplies are adequate for a moderate to active demand. MAHI MAHI The market rose slightly again this week on key sizes of portions. Currently, portions and fillets are running 20-25% higher than the same time LY. 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. WHITEFISH COMPLEX (COD, POLLOCK, HADDOCK) COD: The cod markets, both Pacific and Atlantic, were quiet this week. POLLOCK: The market remains stable on both domestic and imported Pollock fillets. HADDOCK: The market was steady this week. KING CRAB The market for red and golden crab was stable this week. The market place is stable to unsettled, with demand dull and supplies more than adequate. TUNA, YELLOWFIN (CO TREATED) Pricing for tuna is starting to firm up as supply has started to decline, especially out of the prime fishing area of Indonesia. As for Saku, strips and center cut loins, they are still reasonably priced but these items will also become tight as fishing, or the lack thereof, starts to hit these varieties as well. CRABMEAT (BLUE & RED, PASTEURIZED) The market took another upward adjustment this week on all jumbo and claw forms of canned crab meat. 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 & ALASKA: Canada There has been a little more activity in the market with some larger players looking for pricing but no commitments. Most feel the Japanese will be packing through the end of June. The result is that the market has somewhat stabilized for the near term in some cases some price strengthening. Alaska the market is stable with most products committed. 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 very firm with a tight supply situation. The Canada Season has opened but is still very much hampered by ice in the Gulf and areas of Newfoundland. OYSTERS The Gulf has been picked clean and will officially close the end of May reopening in October. Galveston Bay is officially closed and open now only to those with leased beds. Fresh Oysters will be tight throughout the summer as a result. 6

7 PRODUCE VEGETABLES POTATOES Russets: Regional russet demand continues to be very steady and hasn t seen many large changes this week. Pricing continues to advance for the larger sizes in every shipping region. All growing areas are pleased with their available volume for the remainder of the shipping season. Idaho russets have had fair quality. There are some reports of pressure bruise and internal black from the storage crop. The new Idaho crop looks to be harvested around the first week of August. Reds: Demand for reds is moderate to light, which is helping to keep the market steady. Expect supplies and demand to increase as se get closer to Memorial Day. There are several growing regions shipping reds at this time. Red River Valley only has four packaging facilities shipping storage supplies at this point. Harvest for the desert crop of reds in California continues while the Bakersfield and Kern County crops are slowly beginning to ship reds. Texas how has supplies and Florida has started shipping reds, the majority of their supplies will not be available until next week. White, Yellow and Fingerling: New crop yellow potatoes are available out of Fla., Texas, Ariz. and Calif. The quality of these new potatoes looks great, and the pricing has begun to decrease as the availability increases. For white potatoes, the pricing and demand have been very steady, and new crop round white potatoes are available out of Fla. while new long white potatoes are available from shippers in Calif. As there are limited quantities of new crop fingerlings available from Fla. and Calif., the pricing is currently above average. LEAF LETTUCE Supplies are light on all leaf lettuces and prices are up. Quality is also suffering from the heat with some issues of fringe burn in the fields. Romaine carton is weighing 38-39lbs per case and per head. Expect Green and Red leaf to be at 22-25lbs with per head. GARLIC Garlic demand continues to be steady. There are some older products available at a low price so be aware of possible quality issue. US Customs are allowing entry of some Chinese Garlic containers. Suppliers are not looking to take on any additional business at this time and prices are expected to go up. CABBAGE Cabbage is being harvested in Florida with moderate supply out of Georgia. Quality and supply is good and the market is stable. ICEBERG LETTUCE Good supplies available this week in Salinas. Quality is fair with carton weighting between 41-43lbs. Prices are higher this week. Hot temperatures in the 90 s are causing concerns with sun scald as growers have to start trimming product as they pack. Expect to see product out of label next week as a result. ONIONS The onion market leveled off over the past week following a two-week decline. The Texas and California shipping seasons are in full swing and Georgia growers are also well underway with their Vidalia marketing season. Northern California and New Mexico growers will also begin shipping their crop in roughly a month. The summer onion market can be volatile so it is an ideal time to secure pricing. CHILE PEPPERS The Chile market is steady with good supply and quality available out of Mexico and Coachella. SQUASH Squash supply continues to be extremely tight due to the rains. FOB prices remain high. Quality is only fair due to winds (scarring) and rain. Harvesting is mostly in the Plant City area. The Georgia crop is behind schedule due to previous rains. GREEN BEANS Florida has no supply due to rains. Quality is poor and the market is extremely active. Georgia expected to start in a light way late this week or early next week. 7

8 PRODUCE TOMATOES Rounds: The Florida round market is finally firming up after weeks of downward trends. Production has not slowed, however the demand has improved. Next week could increase slightly but for the most part should stay relatively stable. Mexican rounds continue to be more of a niche market. With their season coming to an end in the next couple weeks, quality has been fair at best. Some growers have started to harvest out of California and quality has been very good. Cherry and Grape: Grape and cherry tomatoes remain steady in Florida. Stable supplies on both items are met with an equally steady demand and the market has not moved much on either commodity. As we move into spring, the price should come down slightly as San Diego begins to ship out more volume. Cherry and grapes in Mexico will begin to see more volume as we head into late May. Shippers in Nogales are winding down on both items. The sizing in Baja California started out large but has now settled down, providing shippers with a wide spectrum of sizing. Romas: Roma tomatoes in Florida remain status quo. The market is steady and remains near the bottom as supplies remain strong and demand is relatively low. The quality remains very good. In Mexico, romas are still flourishing. San Diego has begun. Quality is variable from shipper to shipper. Expect good supplies for the foreseeable future. CUCUMBERS Cucumber market is strong with high demand. FOB prices are up. South Florida crop is finished and the rains have adversely affected the Central FL crop and have delayed the South Georgia crop creating a small gap. Mexico continues with light supply crossing from Yucatan. Quality is fair at best in all areas. EGGPLANT Florida has light supply and quality is improving. Markets are steady. BELL PEPPERS Green Bell peppers markets are strong and prices are up. Florida has light supply and quality has been affected by the rain. Most peppers are sizing larger and quality will vary from lot to lot. Quality on Red peppers is good but supply is also very limited. The Red peppers market is still strong but showing some weakness. CARROTS Jumbo Carrots supply continues to be steady due to good growing conditions in Bakersfield. Markets are steady and quality is good. CELERY Celery market is steady with moderate demand. Supplies are steady with seeders* still evident in the Oxnard fields. Quality is good with good green color. Oxnard is expected to be done by mid-june. *Seeder occurs when the middle of the plant grows faster than the outside causing fewer stalks to grow per plant. 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. Prices continue to be very strong and could go higher before leveling off next week. Some shippers continue to prorate heavily this week. Harvest days have been spread out and it s hard to get a constant supply. Quality is fair to good. ASPARAGUS California and Washington supplies are light to steady with Asparagus sizing is mostly large with a few standard sizes available. Quality is nice out of both areas. New Jersey is starting with light supply and Michigan is projected to start next week with light supply. 8

9 PRODUCE BROCCOLI Broccoli supplies will be light this week with only moderate demand and prices have moved higher. Due to most shippers harvesting ahead of schedule, we are possibly facing production gaps in the coming weeks. Quality is good overall with an exception of occasional hollow stem. TROPICAL PINEAPPLES The pineapple industry has recovered from the Mother s Day demand and is now stable. Quality remains very good. BANANAS The banana industry is stable with supplies and pricing. Organic banana market continues to struggle with lack of supplies, we expect this to continue for around two more weeks. AVOCADOS The avocado industry remains stable. Fruit from Peru will be on the market next week. Smaller fruit is slightly limited with the Mexican and California crops having more 48 count product. Product from California and Mexico is great with oil content and overall quality. With product coming from a few sources it s important to note that the color of the skin is not a sign of ripeness. MELONS CANTALOUPES The cantaloupe market has stabilized and has good demand. Product is mainly coming from California and Honduras, with Florida crop also on the market. Honduras crop is finishing so the quality can be questionable. Product from California is good quality and volumes. However, the heat in California is expected to slow the crops down. HONEYDEWS The honeydew market is experiencing strong demand. Currently product is coming from Mexico and California, but both are not the volume needed to meet the demand. The volumes should improve once California moves past this extreme heat. Overall quality is good. 9 WATERMELON The watermelon market is very active with the demand increasing and fruit supplies cannot meet all of the demand. Quality is excellent with high sugars. BERRIES BLACKBERRIES The blackberry industry continues to improve with volumes out of Mexico and this is leading to better prices. If the weather remains good the supplies will not be affected. Quality is good. STRAWBERRIES The strawberry market remains steady with prices and quantities, with the strawberries running very large. California is having a heat wave so this will make the strawberries turn red fast leading to smaller berries. The heat might also affect the quality moving forward. RASPBERRIES The raspberry remains the same as last week. The industry is struggling with the warmer temperatures in California and this could lead to price increases. The main source for Raspberries is California with Mexico almost done. BLUEBERRIES The Blueberry industry in Florida is past peak production and Georgia is now in peak production. In the west California also has great supplies. We are seeing the markets decrease as the volumes are increasing. Quality in all areas is very good. GRAPES The market still has some Chilean reds but the supplies we be gone very soon. Mexican and Coachella Valley Fruit are the main supplies available. The product from Mexico is good quality but the sizes are slightly inconsistent. The Coachella fruit is excellent quality.

10 PRODUCE HANGING FRUIT APPLES The apple market will start to increase slightly as supplies are decreasing and exports increase. Quality remains very good. Organic apples are becoming short on supplies. PEARS The pear market remains stable. As we move into June we will start seeing prices increase as supplies decrease. Bosc varieties are finishing and Red Anjous is still expected to wrapping up in June. Quality is very good. CITRUS LEMONS The lemon industry remains similar to last week with strong demand on all sizes. We are expecting prices to increase until Chilean product is on the market. The juice content is very good but there is some rough textured fruit and scaring on the skin. Most of the product is coming from district 2 (coastal area). ORANGES Currently there are both Valencia s and Navels on the market but the Navel s should be finished at the end of May. We are seeing excellent demand on all sizes. Quality on both varieties is very good. LIMES The lime pricing is down significantly because supplies have increased. The larger sizes still remain limited but not as limited as it was a few weeks ago. Quality is improving as the volumes increase but there is still some poor quality. 10