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 $145 last week which was up from the previous week. When more animals show up for slaughter, the packers will take advantage of this by increasing production which should allow for lower prices. However, higher pricing this week on some items is the result of sustained lower slaughter levels. Rounds Insides: Prices continued to fall on insides. There may be some price increase in the next week or so, but the market should continue to fall going into early summer. Flats: The price on bottom round flats was lower last week. We could still see some decrease in price the next couple of weeks, but should see the bottom shortly. LOINS Strips: The choice strip market declined last week with select strips taking a slight increase. We could still see some price fluctuations a couple of more weeks before the market starts to weaken moving into summer. Top Butts: The choice top butt market did fall last week with the select product taking a slight increase. The market will continue to move lower into summer. Ball Tips: Product is readily available with minor fluctuations in pricing. Tenderloins: All grades of tenderloins have seen some sporadic price fluctuations, up one week and down the next. Prices are down this week again, and we do expect all grades to have some overall downside for the longer term. Chucks Chuck Rolls: Chucks increased ever so slightly last week with lower beef production, and interests in front of the holiday. We can see them still weaken going into summer. thin meats & grinds Flap Meat: Choice flap meat took a very small increase last week with selects increasing higher than expected. This is due to lower production levels, but in the next couple of weeks, increased slaughter will make product more available. Briskets: Brisket pricing was up slightly week over week, and may have some fluctuations the next couple of weeks. We should see the market fall going into late summer. Grinds: Grinds fell more than expected last week with large sales volumes. We will probably see some increase in the market before July 4th, but we expect this market to decline afterward. Skirt Meat: Outside skirts decreased last week from little interest in the market, but expect skirts to be higher next week with low slaughter levels. Pricing should decline going into summer when slaughter levels increase. ribs RibEyes: Ribeyes continue to hold their value with price increases for both light and select ribeyes. This trend of slighter upside will continue into early summer, but then we should see them move downward modestly. 2

3 pork Base hog prices traded steady to slightly higher across major markets as buyers deal with tightening supplies of slaughter ready animals. Slaughter numbers for this week are estimated at 1.89 million head which is about 3.0% below year ago levels. Hog supplies typically decline during summer months, however this year lower hog supplies have prompted some packers to reduce their operating hours and run a 4 day schedule. Packers are expected to run on a reduced schedule through the July/August time frame. Buyers continue to focus their attention on packer margins, weekly slaughter numbers, and hog weights. Hog weights are steady to slightly lower but continue to remain above year ago levels. Warmer temperatures and slightly higher feed costs should have a negative effect on weight gain as we move through the summer season. On the demand side last week, pork prices were generally higher for all commodity cuts except spare ribs. This week, prices for butts, ribs, bellies, hams and loins are expected to trade steady to slightly higher on improved demand from retail features. In the upcoming weeks, expect overall pork prices to trend higher through mid/late June. Supply disruptions could support higher prices and volatile markets. Loins The markets for bone in and boneless loins moved higher on stronger retail demand. Prices for the loin complex 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. Prices for both bone in and boneless loins are expected to move lower during July. tenders Pork tenders traded higher last week on strong retail demand. Prices are expected to trade steady and gradually move higher as retailers plan their early July and July 4 features. Butts Prices for bone in and boneless pork butts moved higher on increased domestic and export demand. Prices are expected to gradually move higher through late June then gradually Ribs Spare Rib prices moved lower last week as buyers remained on the sidelines. On the other hand, Back Rib prices traded higher on improved demand from retail and food service. Prices for both Spare Ribs and Back Ribs are expected to trend higher through late June as retailers plan their July 4 features. 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 traded higher last week on limited supplies of fresh product. Belly prices continued higher in early week trades and are expected to gradually move higher through early July. Retail demand for bacon remains weak and could put pressure on pricing. Supply constraints may create increased volatility and support higher prices. Hams Ham prices traded slightly higher last week and early this week on stronger export demand. Ham prices are expected to trade steady to slightly higher through late June due to strong domestic and export demand. Prices are expected to remain above year ago levels through late fall. Trim The following market dynamics will impact finished goods pricing during July. Pork trimmings are starting to decline from their record highs, however, remain above year ago levels. Processors will re-fill the pipeline for July 4 orders, then begin to slow down and review their finished product inventory levels. Picnics Pork Picnics prices traded steady to slight higher last week on strong processor demand. Prices are expected to trade steady to slightly higher through late June as processors utilize lean meat in sausage manufacturing and produce additional items for retail ads. Demand for exports and unanticipated supply constraints could support higher prices. 3

4 Turkey The Turkey complex continues to rise. Frozen whole birds gained slightly on the market as people continue to book their holiday turkeys. Supply is getting tight. Freezer stocks for non-contracted product are very low, down 19.4% compared to last year. poultry The high demand for chicken has remained constant moving into the summer. Chicken continues to be the lowest cost meat protein as beef and pork prices remain high. In a typical summer season, beef becomes the dominate protein of choice; however this summer that trend seems to be changing to chicken due to costs. Poultry processors are not only challenging the beef dominance with the traditional chicken parts and boneless breast offerings, new products are showing up on the retail shelves. Chicken sausages in a variety of flavors, chicken burgers, chicken kabobs and marinated chicken breasts with on-trend flavors are grabbing more of the retail meat counter than at any other time in history. As the demand for chicken continues at a record pace, not the normal summer slippage of demand; the poultry industry is not increasing the supply of chicken. Hatcheries in the United States weekly program set 215 million eggs in incubators during the week ending May 31, 2014, up 1 percent from a year ago. Broiler growers in the United States weekly program placed 172 million chicks for meat production during the week ending May 31, 2014, down 1 percent from a year ago. The only growth in the chicken industry will be due to farmers increasing their bird weights. The small bird is now mainly grown for contract business for QSR. The jumbo chicken can grow to weights between 8 and 11 pounds, providing the farmer with a better investment on space efficiency and feed conversion. This is creating a different market trend for this summer. The market traditionally peaks at Memorial Day, and then slowly deflates until the spring of the following year. So far this year, the market peaked, and is now maintaining prices as the market remains steady. Many analysts feel this sideways trend will continue until the grilling season ends on Labor Day. Boneless SKInless turkey BreastS The boneless breast markets continued to rise to new record highs. Further processors are paying over the market to obtain enough raw materials to cover their processed meat contracts. The markets today are over $2.00 a pound more than last year at this same date. We expect to see this market to edge up slightly in the future. Boneless Skinless Breasts The supply has been able to keep up with the demand; however finding additional spot loads of boneless is extremely difficult. The market should remain flat. Chicken Tenderloins The tenderloin complex remains in high demand with prices of select tenders at an all time market high. Many small processors are converting the production floor space to split jumbo tenderloins so they can reap the profit of the select tenderloin market. Wings Though the wing market remained flat, the demand continues to fully support the supply. This market will slowly trend higher through the football season. Boneless Skinless Thighs Much like last week, the retail segment is featuring boneless and bone in chicken thighs and leg quarters. Exports were down slightly this week, thus holding the market even. The prediction is for this market to move up slightly as the summer continues. As for the current market, prices remain flat with small bird WOGS, parts and tenderloins being extremely difficult to find. The rest of the market appears very balanced as far as supply and demand. commodity grocery Oil U.S. soybean planting was reported at 78% complete, up from 59% the prior week and above the five year average of 70%. Soybean emergence was reported at 50% compared to 29% last year and the five year average of 45% Favorable weather over the past week should have allowed for all but the northern most regions to have been planted. The USDA released monthly report on Wed June 11th. The lack of bullish news kept pressure on the market, and we saw the entire complex close lower that afternoon. The next major report comes out later in the month and traders are expecting the Government to find millions of bushels over last year s crop. This data will influence the direction of the market. 4

5 dairy Butter The butter market appears to have topped out at the highest level in almost 10 years. This high is negatively impacting both domestic and international demand. Overall production continues to lag year ago levels. Cheese Even though CME prices have been volatile trading both up and then down within the same week, they have been moving higher week over week. The lower averages made buyers more interested which put additional upward pressure on the markets. Markets have seen downward movement since the beginning of this year however, year over year markets are 20% higher. Shell Eggs Egg markets began to show some weakness this week. Demand is fair while supplies are readily available. Milk/Cultured Milk prices are still at record highs, although there has been some relief in Fluid Milk pricing for the month of June. Cultured Dairy products saw significant increases impacting all segments. seafood Shrimp, Domestic (Whites and Browns) The Domestic brown and white shell on shrimp complex remained mostly unchanged this week. Exception to the steady market, U15 sizes and higher continue to rise as supply will not be available until mid-fall. For all other sizes, sellers are holding at current pricing as the markets adjust to recent inshore openings and closings in the Gulf. With the slightly delayed opening, sellers are waiting for information as to where sizing maybe on what the fisherman are catching. The Domestic PUD Market was barely steady to weak. Louisiana inshore season has opened with processors competing for the raw material to fill inventories and get product back in the pipeline. The weakness is due to the amount of supply coming in supply up = price down. Shrimp, Latin Central AmerICa (Whites) HLSO white Latin shrimp complex remains unsettled, with 21/25 & 26/30 sizes being particularly weak. Supplies are more than adequate for a quiet demand. Importers are reluctant to buy replacement product based on current demand. 31/35 and smaller 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 and P&D Asian Tiger market was mostly steady this week, with some sporadic lower offerings where importers are adjusting against Asian white shrimp pricing. It will be July/August before any large volume of tigers is harvested. 5 WHITES: The Asian White HLSO saw some weakening in the 21/25-26/30 size as well as 31/40-41/50 sizes. 16/20 size is full steady to firm with supply tightening. 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 remained unchanged this week and the market has a firm undertone - supplies remain limited. Raw material remains short and what 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 is harvested. IMPORTED: The market is currently stable, however it has a firm undertone. Inventories in the US are starting to get tight as the Spring harvest was considerably lower than LY. 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.

6 seafood (Cont d) Salmon Chilean Farmed Salmon: Chile is currently at a low point of production into the next few months, with fresh pricing remaining firm and very little fish for frozen programs. Even though production is expected to increase approximately 5% for 2015, prices will remain high due to increased production costs, disease management and a 7% increase in global demand for customers that appear to be willing to pay premium prices. A quiet demand this week has fresh pricing adjusting lower but frozen portions remain in tight supply and pricing is firm. Mahi Mahi The market was stable this week. Sellers are firm on pricing and inventories are below last year s levels with demand brisk. Scallops SEA: The market was mostly steady this week, with slight weakening on 10/20 & 20/30 processed scallops. Supplies do remain on the light side as the marketplace 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 There is very little raw material available and most plans are running well below capacity. Fresh & Frozen pricing remains firm world- wide. Pricing also remains firm at 5 years highs within China s domestic market. As has been pointed out in the past, most of the production in China stays in country. Moreover, there has been a significant demand locally for smaller fillets, which prompts the farmer to remove the fish earlier than usual. This has pushed the pricing upward on the bigger sizes and we probably won t see any relief until the end of summer. This has not hurt demand for this species but just making it more difficult to find. No changes to this situation are anticipated until new season production makes its way to the US in the early Fall. Whitefish Complex (Cod, Pollock, Haddock) Cod: The market remains stable on both Atlantic and Pacific Cod. 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 steady on fully adequate supplies and quiet demand. Tuna, Yellowfin (CO treated) Pricing was stable this week for Tuna. Lighter catches in the Western Pacific are contributing to higher prices as we move into the Summer. Crabmeat (Blue & Red, Pasteurized) The market was stable this week with a very firm undertone. 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 exception is Red crab from China which appears to be adequately supplied and somewhat unsettled on pricing. Snow Crab Canada: The market has firmed in Canada, especially on 5/8. The Japanese continue to dominate production time in the plants and it appears they will be in the plants through the end of the season. Alaska: The market was steady this week at listed levels. LOBster TAIls Warm water: Brazil season opened June 1 and in anticipation of that product hitting by July, 9 oz and higher tails have weakened in price. Prime sizes 3 oz through 8 oz remain full steady at this time. Cold water: The market was mostly quiet this week with pricing stable. AmerICan Tails: 3-4 oz tails have weakened slightly and the remainder of the market remains unsettled. Fishing has improved dramatically in Canada with the processors working straight out and double shifts to keep up with the fisherman. However, this increased supply is not yet reflected in lower prices on most sizes. 6

7 produce vegetables potatoes Russets: Demand for Idaho russets is steady and prices are holding at current prices. The continued higher prices over the last six weeks have finally stabilized. Idaho shippers have six to eight weeks worth of storage crop potatoes left before moving on to the new crop in August. The quality in Idaho has been improving as growers tend to hold onto their best supplies for the end of the season. Spring temperatures in Idaho have been optimal for growing. The pricing increases in the nationwide russet potato market that we have seen over the last couple of weeks have leveled off within the past few days. The consumer market for russet potatoes continues to be very slow and steady with few changes in any shipping area. Reds: Red potatoes are almost done in North Dakota for the storage season. Harvest of red potatoes continues in Bakersfield and the Kern County region of California. The Pearsall, Texas, season is expected to wrap up in a few weeks, while the Muleshoe region will begin shipping around mid-june. Growers in N.C. and Va. expect to have a mid - to late June start date for their red potato season. The crops in Minn. and Wis. are starting to catch up thanks to the excellent weather recently; growers there expect to start shipping around late July. White, Yellow and Fingerling: Although there have been some spot shortages of white potatoes in the Southeast due to weather, the market is steady with very few price changes. Long white potatoes are available in Calif. as well. Yellow potatoes have depressed pricing compared to seasonal averages because of some higher than normal yields in Fla. and Calif., but also have excellent quality. New crop fingerling potatoes are available from Calif. and have great quality as well. Fingerling potatoes are a great option for summer ads. GarlIC The markets for both peeled and fresh garlic remain strong this week. Prices are expected to get stronger. Quality varies with pricing reflecting on quality. CABBage Georgia is finishing its production and North Carolina is slow to start due to dry condition in growing areas. Quality is mixed and the markets are much stronger this week. Leaf lettuce Light demand for leaf lettuce this week has stabilized this market. Romaine is available in good supply. Shippers are still finding some fringe burn but other than that the quality is nice. Green leaf supply is still light and there are still some lingering mildew issues due to foggy weather in the growing regions. Red leaf is a little below normal supply and has some presence of mildew from the fog. Iceberg Lettuce Lettuce supplies are average coming from both Santa Maria and Salinas growing areas. Santa Maria lettuce is reporting a lesser quality with light color and firm hard heads. Salinas has experienced cooler weather that has allowed for better quality. The weights are good ranging lbs. per carton. Supplies will be strong enough to have promotion volumes in the next 1 to 2 weeks. Onions The onion market has remained largely unchanged over the last week. Sufficient availability out of several growing regions partnered with moderate demand has led to below average, but stable, pricing. There is less availability of white onions with hit and miss quality. Vidalia sweet onions are still being shipped in large quantities out of Georgia. The quality of Vidalia onions has been very good all season long. Growers are expecting their season to run through August this year. ChilE Peppers The Chile market is steady with good supply and quality available out of Mexico and Coachella. Shippers are anticipating a small gap by the end of the week due to heat in Mexico. 7

8 produce Tomatoes Rounds: In Florida, the Palmetto - Ruskin area has virtually finished, leaving only a few shippers with product available in that area. Quincy and South Carolina have started up. This increase in volume has steadied the rising market from the past three weeks. Pricing has coincided with this increased availability and will see more relief in the next two weeks. Mexican rounds continue to be available though the demand has fallen off slightly. California shippers have begun to start their deals, and more pressure has shifted away from Mexico. Next week should see a dip in pricing as the south east fires up. Cherry and Grape: Cherry and grape tomatoes continue to be scarce in Florida. Last week s steady demand and extremely limited supplies shot market pricing up, however with supplies still limited down south, pricing remains high this week. Cherries are the hardest to find and are beginning to appear in northern Florida and South Carolina and should be in better supply in the next ten days, bringing the market down a bit. Until then, expect the two commodities to remain high in price. Cherries and grapes in Mexico are tight as well. Pricing remains high and competitive with Florida for the time being. Some growers out of McAllen will start new fields in the coming week, which will bring more supplies to market, easing the demand pressure off San Diego. Romas: Roma tomatoes in Florida have not seen many changes this week. There is more product available throughout the state, but volume is beginning to fall off every week. The quality has been strong and pricing has taken a slight dip product coming out of Baja California. Expect quality and availability to decrease for the next two weeks. The market for Mexican romas is coming down slightly. With Nogales still shipping out product along with Baja California beginning it s summer crop, pricing has come off on larger sizes. Quality for Mexican romas has improved. Nogales will finish up with its supplies in the next month, making Baja the next main player for romas. Cucumbers Cucumber supply continues to improve out of North Carolina, Georgia, and South Carolina. Quality varies from grower to grower with pricing reflecting on quality. Pole grown Cucumbers have fared well compared to ground grown Cucumbers. Mexico continues with good quality and supply crossing into south Texas. Squash Squash markets are steady with more volume available out of Georgia, North Caroline and South Carolina. Quality is still improving but there s an occasional scarring issue. Green Beans Bean markets are much stronger this week. Georgia beans supply is much lighter and North Carolina is starting with moderate supply. Quality is good with no reported issue. Eggplant The market continues to be steady with moderate supply available out of Florida. Quality is good with no reported issues. Bell Peppers The Pepper market continues to be strong. North Florida/Georgia fields are coming on with more volume but are still below normal yields. Quality is still poor due to the many storms the region has gone through. North Carolina crop is projected to start this weekend. Carrots Jumbo Carrots supplies are lighter but, the market continues to be steady. Bakersfield is continuing to produce good quality and sized carrots. Celery Oxnard celery production will be finishing up in 1-2 weeks depending on shipper. Salinas s production has started in a light way and volume will increase over the next few weeks. Good qualities are available from both areas. 8

9 produce Green Onions Growing conditions continue to be excellent in Mexico and supplies are steady. Expect this market to remain steady with no changes in demand. CaulIFlower Cauliflower market is unstable with price changes in reflect to demands. Expect this market to firm back up by the end of the week. Supplies are expected to be light all week. Quality is good on the few supplies that are available. Asparagus Asparagus market is slightly weaker and demand remains light this week. Peru has slowed shipments as the growers wait for the market to recover. Michigan is going with good volume. Quality is good in all growing areas. Broccoli Broccoli supplies are still on the light side. Market is steady with good quality. Expect to see light supplies for the next couple of weeks. Virginia production is expected to start the week of June 17th with limited supply. tropical Pineapples The pineapple supplies have decreased slightly and this is causing some market pressure. Most fruit is coming in from Costa Rica with a little from Mexico but Mexican quality is questionable. Bananas Demand has increased but exports have also increased to meet demand. Currently the markets remain stable. Avocados Traditionally in June, avocadoes are heavily promoted. Currently, demand is already high but so is volume. California is past its peak product but still has plenty of volume. Mexico also still has plenty of old crop. The Flora Loca crop is expected to be harvested in early September. Peruvian volumes continue to increase. The crop is heavy on 40 and 48 counts. Melons Cantaloupes The Cantaloupe market unchanged from last week with very strong demand. Imperial Valley and Yuma are light on supplies so most of the demand is being filled by Arizona product. Quality of the fruit is good. HONEYDEWS The honeydew market is very strong as supplies are lacking in volumes from the desert region and Mexico. Central valley should have volume in a week and then Westside should have product in mid July. Quality remains very good with nice color. Watermelon The watermelon market is steady and we expect it to stay this way for a month. California and Arizona has good volumes/ Central Valley is increasing with volumes. Quality is good. Berries Blackberries The Blackberry market is being driven by Georgia, North Carolina, and California crops. Mexico is almost done. Quality on domestic crop is excellent and the market will be stable for a few weeks. Strawberries The strawberry market is being affected by the heat. Berry shippers are moving most of their products to the freezer in Santa Maria. Salinas and Watsonville are still not at peak production yet. Once we hit peak market prices should decrease slightly. Quality is good but with the heat the product can bruise easily. Raspberries The raspberry market is slightly short on supplies but volumes are building. We expect that the market price will decrease at the end of June. Currently quality is good. 9

10 produce Blueberries Domestic crop from Georgia, California and North Carolina are all higher than expected volumes. We expect this to result in a market decrease over the next few weeks. Quality is very good. Grapes The grape market continues to experience excellent demand, especially on reds. The heat has slowed the harvesting and also damaged some of the fruit which is leading to lighter supplies. Central Valley should have product at the end of June. HANGIng FRUIT Oranges The orange market remains steady with high demand on all sizes. We are expecting the market to remain at the current rates until July when the market will start increasing. Growers are trying to maximize the fruit on the trees without using too much water. Quality is very good with both sugar and juice content. Limes The lime markets are still decreasing but are expected to stabilize shortly. Much like last week, the largest decreases are coming on the larger sized fruits. Demand for limes continues to increase. Apples The apple market remains steady as demand has decreased slightly due to school being out for the summer but the market has not decreased as the crops are finishing up for the season. Quality remains consistently good. Pears The pear market is also unchanged from also week. California pear season is about a month away. Quality is still good but overall smaller sized pears are running very short. citrus Lemons The lemon market is very tight with product and demand continues to increase which is leading to market price increases. We expect this trend to continue to August and the only possible relief might come from Chilean fruit which should be on the market in July. The quality is fair with good juice content. 10