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 last week down 3 cents and is expected to close down another 3 cents this week. Production levels still remain well below prior year, as suppliers continue to adjust pricing to keep inventories moving. Activity this week was down compared to last week, as buyers have secured their needs for the Labor Day holiday. Rounds Insides: Prices have retreated backwards this week as more inventories have become available. Forward projections show more downside risk. Flats: Bottom round flats are following the insides. We should see the same time frame of downward price adjustments as the inside rounds. LOINS Strips: The strip loin market is struggling to hold its value. We will see the strip loins move downward as the grilling season comes to an end. Top Butts: Top Sirloins showed a modest increase this week compared to an down market last week. The trend will be downward pricing as we come out of the grilling season. Ball Tips: Ball-tips reported a moderate decrease this week and we are projecting more of a downward turn in the market as we go into September. Tenderloins: Choice and select tenderloins continue to move upward with heavy demand. Forward projections are that we will see more of a sideways market in price on choice tenderloins while the select tenderloins will be under pressure with downside risk to cost. ribs RibEyes: Light choice and select rib eyes moved modestly upward this week with heavy demand. Heavy ribs also reported up modestly. Out front projections are that we will see the rib market retreat backwards through September and then rebound for the holiday needs through November. Chucks Chuck Rolls: Chuck rolls are under pressure with pricing adjusting downward. We do project lower pricing levels into September. thin meats & grinds Flap Meat: Both choice and select flap meat continues to struggle in the market where suppliers are discounting product to keep inventories moving. We will see continued downward pressure through September. Briskets: Briskets reported slightly up this week and are expected to be more sideways through September before they gain strength with heavy demand out front. Grinds: Market moved up slightly from last week, we do expect grinds to retreat backwards after Labor Day as demand will diminish. Skirt Meat: Outside/Inside skirts rebounded this week, but are expected to drift lower based on lack of demand. 2

3 pork Base hog prices were quoted steady to lower this week. Hog prices are forecast to trade sideways to modestly lower through this week as packer demand remains light before the holiday week. Hog prices are expected to trade steady to slightly lower through September. Last week slaughter numbers were about 11% above year ago levels. Updated projections indicate that hog supplies will be abundant through the balance of Q4. Hog weights moved slightly lower last week. Weights are forecast to trend sideways to lower through late September then gradually move higher as cooler temperatures signal a transition to the fall timeframe. Warmer seasonal temps may result in lower hog weights. On the demand side, retailers and foodservice operators are featuring many pork items in Labor Day promotions. Demand for commodity cuts is expected to remain firm through mid-september then become stronger late month through October as retailers feature pork for October (Pork Month) promotions. Both domestic and export demand for hams remains strong in anticipation for the holiday season, while demand for bellies appears to be slowing down as fall approaches. Loins Prices for both Bone-in and Boneless Loins were lower last week due to excess supplies and weaker than anticipated demand. Prices for both boneless and bone-in loins are expected to trade slightly lower through early-september then gradually move higher mid/late-september supported by retail promotions. Increased export demand may support higher boneless loin prices during September. tenders Pork tenders continued lower last week pressured by excess supplies and weak retail demand. Prices are expected to move lower through mid-september then firm and move higher through late-september in anticipation of retail promotions during October (pork month). Butts Pork Butt prices traded steady to slightly lower pressured by excess supplies. Prices are expected to trade steady to slightly higher through mid/late-september then gradually move lower during October. Increased export demand may support higher price points during the early fall timeframe. Ribs Spareribs held steady to slightly higher last week supported by retail demand. Spareribs and St. Louis Ribs are expected to trade steady to slightly higher through this week then move lower due to reduced (seasonal) demand. Back Ribs traded lower and prices are expected to continue to decline through October. Bellies/Bacon Bacon/Belly prices moved lower last week with gradual declines expected through mid- September. Belly prices are expected to continue declining through Q4 with significant price declines expected during late-september/ early-october. Hams Ham prices moved slightly higher supported by strong export and domestic demand. Prices are expected to trade steady to slightly lower this week then gradually move higher through October. Trim The following market dynamics will impact finished goods pricing during the September/ early-october timeframe. Pork trimmings prices are in their seasonal decline and expected to trend lower through September. Similarly, beef trimming prices trended lower through August. Thus, prices for beef and all meat hot dogs are projected lower for September/early October timeframe. Picnics The following market dynamics will impact Dinner Sausage prices during the September/ early October timeframe. Pork Picnics continued slightly lower due to excess supplies and weak processor and export demand. Picnics are expected to trade steady to lower through mid-september then gradually move higher during early Fall. Dinner Sausage prices will be lower for September orders. 3

4 Turkey Whole Frozen Turkey Larger Toms (22+ LBs) are difficult to find and the industry has not begun its recovery yet. For information on the bird flu, please refer to us Foods "You Need To Know"- Avian influenza Updates. Boneless SKInless turkey BreastS The turkey market is still 6-12 months away from a full production recovery from this season s Avian Flu issues. Markets may continue to rise as availability continues to tighten. poultry Hatcheries in the United States weekly program set 212 million eggs in incubators during the week ending August 22, 2015, down 1 percent from a year ago. Hatcheries in the 19 State weekly program set 204 million eggs in incubators during the week ending August 22, 2015, down 1 percent from the year earlier. Average hatchability for chicks hatched during the week in the United States was 84 percent. Average hatchability is calculated by dividing chicks hatched during the week by eggs set three weeks earlier. Broiler growers in the United States weekly program placed 177 million chicks for meat production during the week ending August 22, 2015, up 1 percent from a year ago. Broiler growers in the 19 State weekly program placed 170 million chicks for meat production during the week ending August 22, 2015, up 1 percent from the year earlier. Cumulative placements from the week ending January 10, 2015 through August 22, 2015 for the United States were 5.85 billion. Cumulative placements were up 3 percent from the same period a year earlier. Whole ChICken & Cut-Up Parts With the summer heat keeping the small bird weights down, there is an abundant supply of birds to fill the needs of the QSR segment. The Georgia Dock Price is the lowest it s been in over two months, and may still drop more. Boneless Skinless Breasts The tandem effect of increased supply due to larger bird weights and the seasonal decline post Labor Day bookings has caused a declining market. The breast market should slowly deflate through the end of the year. Chicken Tenderloins The demand for tenderloins will be strong due to further processors preparing for the upswing of demand during football season, but it has not yet affected the movement of the market. This market tends to follow the breast market as we move into the fall, which is why the market is down slightly compared to the decrease seen in the Breast market. Wings Similar to last week, the markets are continuing to correct themselves from a wider than normal gap between Medium and Jumbo Wings. Therefore the Medium Wings are decreasing while Jumbo Wings remain flat. Boneless Skinless Thighs The boneless thigh market has continued to show enough strength for the market to trend sideways. This trend should continue into the fall, at which time deflation should be expected. Bonus Handout: See attached Woody Chicken Breast Syndrome informative PDF 4

5 commodity grocery SOYBean Oil Soybean oil futures made new lows for the move again this week and traders are now eyeing the monthly charts. China s stock market is the driving factor in market instability due to its huge declines recently casting doubt about the Chinese economy. As a result China s soy demand is down due to poor margins and needing letters of credit. Domestic Crop & Production: The USDA raised 2014/2015 and 2015/2016 soybean oil ending-stocks estimates by 125 and 280 million pounds respectively on their August report based on higher production from larger overall soybean crush. The soybean market has moved through the critical pod setting phase with little in the way of weather issues noted. Harvest is underway in the South. Sharply lower palm oil prices and crude oil prices trading back under $40 per barrel are contributing to the continued decline in soybean oil prices. Statistics Canada lowered their estimate for 2015 canola seed production to million metric tonnes, down sharply from 15.6 MMT last year South American soybean planted acreage is expected to be higher this fall;el Niño year (more moisture than normal beneficial so they wouldn t have any drought conditions). Weather continues to be something to keep an eye on domestically as we are fast approaching the harvest for the new crop year. Pod setting is at 54%, identical to same time last year. Canola: Canola came out close to what was expected especially given the upward revisions between this report and the December report. The Canola seed production is down 14.2% from 2014, which is mostly resulting from a 12.8% decrease in average yield to 30 bu/acre. Biodiesel: The market continues to wait for the renewal of the $1 per gallon blenders The US Senate committee has passed a bill to reinstate the blender s credit. The Bill has yet to pass the House and Senate Recent strength in energy markets has made bio-diesel production profitable in the U.S Biodiesel production numbers came in as around 5B Lbs. for Peanut: More Peanut oil inventory should be available this year which should result in more peanut oil production and lower prices as we head towards the end of On the supply side there is a good crop this year. The USDA is projecting 1.6 million acres have been planted versus the previous estimate of 1.48 million acres. Growing conditions have also been good with 80% of the crop at excellent. The big unknown is what percent of the crop will be edible peanuts vs. inedible (peanuts used for oil). On the demand side there are flags that India may be too dry and may not have a good harvest (India is the largest consumer of peanut oil). If this happens there will be increased demand for peanut oil exports, which will push up prices. Palm Oil/used for TFF Margarine: Palm oil prices continue to decline due to continued supply and weak demand. Dry conditions in Malaysia and Indonesia due to El Niño are a major threat to palm oil production for the 2015/16 crop year which could lead to an upswing in prices. Early market expectations of the MPOB report are estimating June ending stocks down % on the back of strong exports. Rice Oil: Total U.S rice planted acreage is projected almost unchanged from last year at 2.90 million acres. Global availability is expected to improve in the second half of 2015, right along with all other oilseed crops. However, additional production information is very limited dairy Butter The market is unsettled in all regions. While cream supplies are tight and prices are firm, butter stocks are by no means excessively tight or low enough to support current butter prices. Butter stocks in cold storage at the end of July were up over 40% from year ago levels. Increased availability of cream and active butter production over the Labor Day holiday is expected to put downward pressure on butter prices. Cheese Cheese markets are volatile but remain higher than last week s average. Seasonally slowing milk and cheese production combined with seasonally stronger demand should continue to support the cheese market out through November. Shell Eggs Markets are slightly down for the third straight week and some relief should be reflected in next week s pricing. Supplies of extra large and large are fully adequate to available. Mediums should be moving into better balance in the coming weeks. Milk & Cream For the month of September, production had been seasonally lower but will ramp back up for back-to-school. Most FMO commodities increased meaning some double digit increases on heavy cream, half & half and sour cream. Fluid milk pricing is flat to higher. California commodities are flat to slightly higher. 5

6 seafood Shrimp, Domestic (Whites and Browns) Domestic shrimp production continues to stay strong. Prices on many sizes are lower. The overall future is for pricing to become stable in the next week or two and then hold for a while. As we get closer to the holiday season there should be an uptick in pricing. Domestic PUDS: Pricing on larger PUDS and P&D s has turned weak. Upcoming shrimp season may bring lower prices. Catch has been good this year and outlook going into fall is plenty of inventories. Shrimp, Imported (Black Tiger and Whites) The Shell-on and value-added Tiger market has seen signs of weakening. The White market has remained steady. The outlook through December will be steady pricing on Farmed Whites. Value-added both P&D and Cooked are showing some weakness on slow sales. (MexICan Browns and Whites) Larger shrimp are showing signs of weakness. We think we will see lower prices in the near future. CatFIsh, Domestic & Imported DOMESTIC: We are starting to see some good harvest on Domestic Catfish. As inventory builds we hope to see some lower pricing. IMPORTED: Inventories are very low and many vendors are cleaning up inventory to get ready for the new season. So far no one is talking about how fish are in the ponds or where new inventory prices will be. Salmon Chilean Farmed Salmon: Inventory is now good on low demand. Prices are falling on low demand. Norwegian Salmon: With the current exchange rate, Salmon from Norway may be a fish you see promoted this year. Inventories look good and many suppliers are looking to move fish. Domestic Wild Salmon: Supplies are good with steady to low prices. Mahi Mahi Current inventory is good as the new season is coming on. Vendors are now gearing up for the new season that will start in October. Scallops SEA: The catch this year is off from last year. Product from Japan is in short supply. Future pricing looks to be $.85-$1.50/# higher. Our Harbor Banks 10/20 and 20/30 dry scallops are a great value! BAY: Pricing is unchanged this week. Tilapia The report from China is production is low and farmers did not seed the ponds at the same rate as last year; this will cause an increase in price once current inventory starts to run low. 6 Pangasius The market has turned steady. Overall outlook is for prices to rise in November and December as a reaction to the tilapia pricing. Whitefish Complex (Cod, Pollock, Haddock) Cod: The market for Atlantic Cod is on the rise. Pacific Cod is showing signs of lower prices. Pollock: The market remains stable to lower. Inventories are good and the Alaska Seafood Marketing Association is looking to promote heavy in the US. Look for bargains in the near future on Alaskan Pollock filets and imported Pollock fillets. Haddock: Current inventory is good and pricing is stable to weak. Fisheries are in good shape and long term outlook is abundant inventory and lower prices. Fishery management made an upward move on the quota allowing more fish to be caught. With this news we should see lower prices driving from now through Lent. Tuna, Yellowfin (Frozen Steaks & Loins) The portion business is seeing a rise in price due to new fishing rules being put in place. Outlook for the next few months is higher prices. King Crab RED & golden: King crab is starting to tighten up with supply; outlook is for higher pricing. Crabmeat (Blue & Red, Pasteurized) Imports on Blue Swimming continues to be good and pricing is lower. New Red Swimming production is due in the US around September 1st. With the low pricing on Blue Swimming crab we expect a lower offering on red. Snow Crab (Canada & Alaska) Catch is done for the 2015 season and 8ups are very tight. There are some 5-8 s still in the market but crab is getting tight and now is the time to buy. The Canadian market has turned flat on 5-8. There is good inventory levels and the overall outlook is after the East Coast summer season we could see lower pricing; time will tell. 8ups and larger are getting tight on inventory. LOBster TAIls Warm water and north american lobster: Cold-water tails, both Maine and Canadian, are now is season. Once the pipeline fills up we hope to see lower pricing. Warm-water tails took a move upward on slow fishing in Brazil. Outlook is for lower prices once other fisheries open up. Lobster meat: Lobster meat has stayed firm in pricing and inventory is tight.

7 produce vegetables potatoes Russets: The Idaho russets market has dropped significantly. Market pricing has hit a point where some growers are moving fresh crop into storage instead of selling it at a low. 80s and larger are down in the market while 90s and smaller remain unchanged due to light supply on smaller size potatoes. Quality is very good. Michigan, Wisconsin, and Colorado have also started shipping russets but have smaller spuds. Once these growing regions go into full production, we will see quite a bit of pressure on the russet market which may keep the market low. Quality is good. Reds and Golds: An abundance of supply in the market is driving prices down. Idaho, Wisconsin, and Michigan are the main growing regions with plenty of supplies. Quality is very good but the B-size price is still significantly higher than the A-size. White/Yellow Potatoes: The market has become abundant with supplies. There are plenty of products available in the market yet market pricing is steady. If the supplies continue to increase, we should see market prices start to drop. GarlIC The Chinese market has unexpectedly moved up due to a short supply. CABBage The cabbage market is up this week out of California and Western/Central New York with light supply and good demand. The cabbage market is flat out of Michigan and down out of Colorado. Leaf lettuce Supplies of romaine, red leaf, and green leaf continue to be steady. Quality is still an issue on romaine and green leaf with mildew, seeders, insect damage, wind burn, and fringe burn. Red leaf and butter lettuce is doing better with fewer issues. The green leaf and the red leaf markets are generally steady. The romaine market is down a little compared to last week. Iceberg Lettuce The lettuce market continues to be stable with the market remaining flat this week. Quality is still an issue with weak tip, internal burn, seeders, mildew, and insect damage due to hot and humid weather. We do not expect the lettuce to improve for at least another 2 weeks. Onions The onion market continues to trend down due to increased supply. Supplies coming out of Washington and Idaho are good yet there are still some shortages on super colossal and colossal yellows. Quality is good. ChilE Peppers The Chile pepper market is down this week with lighter supply and moderate demand. Cucumbers Eastern cucumbers continue to come out of Michigan but the quality is fair at best. New fields in North Carolina are in production this week with quality getting better. Market pricing is slightly up over last week. Western cucumbers are tight in supply which is causing an increase in market pricing. Quality is variable. Squash Yellow squash supplies are increasing in the East which is putting downward pressure on market pricing. Western yellow squash is steady this week with some slight upward pressure on market pricing. Quality is variable. Eastern and Western green squash are steady this week with variable quality. Green Beans The Green Bean market is down this week out of Western and Central New York with light supply and very good demand. Green Beans out of Western North Carolina are down. Eggplant Eastern eggplants are steady this week with some slight downward pressure. Western eggplant supplies are tighter this week which is causing a slight upward pressure in market pricing. Quality is good. 7

8 produce Bell Peppers Supplies continue to be good from the East which is causing slight downward pressure on market prices. Michigan and New Jersey are the major sourcing areas but local deals continue. Western bells are steady this week with good quality. Red Bells dropped again in market pricing due to increased availability but the market is still light on supply. Expect prices to drop even more once availability increases. Tomatoes Rounds: Eastern rounds are nearing the end of the season. Volumes will continue to be tight as we draw closer to the crops finishing up in North Carolina, Tennessee, South Carolina, New Jersey, and Alabama. The outlook for the rest of the summer is tighter-than-normal supplies with higher-than-normal market prices. The current market is steady but expect higher market prices until Florida crops begin harvesting in December. Keep inventories tight due to shorter shelf life on these tomatoes. Western rounds are generally flat this week but should be going down in the next week or two. Quality is good. Romas: Eastern romas are still experiencing tight supplies but are down on market prices. Quality is variable with marginal-quality product cheaper than current market prices. New fields in the West started this week which is causing a downward pressure on market pricing. Quality is good. Cherry and Grape: Eastern and Western cherries continue to be extremely tight but market pricing is generally steady from last week. Quality is variable. Grapes on the other hand are better and have increased supply this week in both East and West. There is some downward pressure on market pricing. Quality is still variable with better fruit demanding higher market prices. Green Onions Green Onions are up this week with fairly heavy supply and good demand. CaulIFlower The cauliflower market is up this week out of Santa Maria, California with light supply and moderate demand. Cauliflower out of Salinas-Watsonville, California is down. Cauliflower has felt the effects of the heat in California. Asparagus The asparagus market out of Peru is down this week with lighter supply and demand. Production continues to drop out of these regions. Broccoli The broccoli market is down this week with lighter supply and demand. Extreme heat has caused many quality issues. tropical PIneapples Pricing has stabilized. Large sizes remain tight, and small supplies are sufficient. Fruit is firm, yet juicy with tropical flavor. Sugar levels are high, averaging on 15 brix. Bananas Supplies are much better and quality is good. Avocados Mexico pricing is down on larger sizes. Supply is still heavily leaning towards these sizes. 60 s and smaller are in limited supply. The new crop is not producing many #2 s. In California, the crop is at the very end of the supply. The pricing is up slightly on the smallest sizes. Supply is limited. Carrots The carrot market is up this week with light supply and good demand. Availability is good for the smaller sizes. Jumbo carrots are beginning to be affected by the heat in California as well as water restrictions. Quality is good. Celery The celery market is down this week out of Salinas- Watsonville, California and Santa Maria, California with good supply and moderate demand. The celery market out of Michigan is flat this week. Quality is good. 8

9 produce Melons Cantaloupes The market is steady and strengthening as demand has been excellent especially on the larger fruit. The internal color of the fruit is excellent and sugars are very high due to the temperature fluctuations in the valley. Good supplies. Honeydews The market is very strong and steady due to excellent demand and less overall acreage in the ground. We will see prices stay firm probably through mid-october due to lighter overall volume. The overall quality has been excellent with nice firm clean exterior and excellent sugars. Growers are also peaking on larger fruit and small fruit is very hard to come by. Berries Blackberries Blackberries have suffered from the warm weather and the quality has been compromised. The best are pulling a premium, whereas the ordinary are available for bargain prices. Strawberries The strawberry market is tight. Shippers have had a hard time making arrivals. Production has shifted from the summer window, to a fall lull, causing the production to steadily decrease. Look for the market to straighten out when night time temperatures return to normal levels. In the mean time, there are plenty of opportunities available at low prices. Grapes Lots of green and red being packed, quality is good, prices are moderate. The same for Globe and black grapes. blueberries The blueberry market will be tightening up this week. We are currently sourcing limited supplies from the Pacific Northwest, Canada, California, and a minimal amount from Baja. As the market transitions from the summer crop to a fall crop, production is dropping, driving prices up. Raspberries Raspberries are super short in supply at the moment. Demand greatly exceeds supply, and volume continues to slide. We are currently sourcing exclusively from California, with Mexican production forecasted to begin in a few weeks. 9

10 produce ALERT The reason the stone fruit season is finishing early this year is because of the early start caused by last winter s warm climate. There may be a significant gap this year between the California and Chile seasons. HANGIng FRUIT APPLES & pears The new crop Gala market is reasonably priced but large sizes remain very hard to come by. Again, the dominant sizes are 100 and 113 s. The major change to report is on Golden Delicious apples. All sizes, all grades, including the early Ginger and Supreme varieties are very tight and hardly any are being quoted. The market has taken a tremendous jump in price due to this supply and demand situation. All the other varieties based on this time of year and the amounts left are rising in price. California Bartletts, Bosc, Seckels, and Forelles are available in good numbers. Pricing remains steady with no foreseeable changes in the near future. The pear market definitely reflects the short pack out. citrus Lemons Lemons prices are stronger this week, especially 88 s and smaller because of demand from the schools. California 115 s and larger are up in price. Chilean, Mexican, and California lemons are available. 95 s through 200 s are available, especially smaller sizes like140 s and smaller. Oranges California Valencia market is a bit stronger again, especially 88 s and smaller because of schools starting up. Prices are up a couple dollars. Quality is good but expect a bit of softness and some greening. Australian and Chilean navels are available. Limes Supplies are good as fruit is increasing and the new crop sizes are up. Larger sizes (175 s, 36 s etc.) are still very short relative to others. STONE FruIT Peaches will go through the month of September. Volume is ramping down. Not all sizes are available every day, and prices are strong. White nectarine season coming to a rapid close, fruit will be intermittently available for the next 2 weeks or so before the season ends. Black and red plums will go through the month of September; the last varieties of the year are being picked. Apricots and Cherries are done until Chile starts up in December. 10