Market Updates for July 30, 2021
Dairy | Eggs
Small - No change
Retail demand mixed. Supplies of extra large and large well balanced and held confidently. Market steady to full steady.
Dairy | Butter
Cream inventories are continuing to tighten as ice cream production starts to compete for raw material and hits it's production stride. Retail sales show signs of decline, but overall are still healthy. With restaurants reopening food service distributors are still coming back to the buying table, but orders are still below expectations.
Dairy | Cheese
The CME Block market responded to the governments release of another billion dollars in the USDA Box program. Speculators feel this will have an effect on the markets for the short term but will not be sustainable for the long term.
Meat | Pork
This week's harvest is forecast to be 2.35 million head, slightly ahead of last week's 2.3 M. Recent news is that a case of African Swine Fever was confirmed in the Dominican Republic, this will not impact materially impact US demand as the Dominican Republic does not allow US pork in it's market. It does give merit to the question how wide spread will ASF become and will in impact US production.
The story remains the same with bone in butt prices, they continue to decrease with the chance that they will level off in the next 1-2 weeks, boneless butt prices are declining in price however not as rapidly as bone in. Loin prices are down to flat this week.
Spare ribs are lower this week, with St Louis prices steady to lower. Back ribs prices are stable to higher.
Belly prices are higher this week, price could level off in the next 1-2 weeks. Shortages are possible due to labor issues.
Meat | Beef
Harvest numbers are slightly higher than previous year's numbers as smaller cattle have dropped the production pounders per cow slightly. We are starting to see the grade come back on choice and select dropping a small percentage. Prime has continued to drop percentage-wise making it even more difficult to come by. Logistical issues with both container ships and port warehouses have slowed the processing of imports and exports. Expect to see good numbers of both exports and imports as we get into August.
The cutout continues to slip as we saw demand get shut down a few weeks ago due to record high prices. Most middle meat items have found some balance at this point and are catching the eyes of retailers. Ribeyes are flat to higher, expect to see these prices for the next few weeks with a possible small dip before heading back up. Deep chill programs will start to come into play in August and September putting some support under the primal category. Striploin and short loins have continued to come off but lead the retail ads for middle meats. We should expect to see both cuts continue downward into October with a small jump around the Labor Day time period. Briskets have started to capture some attention as they fell over 25% in the last three weeks. We should see some retail activity heading into Labor Day. End cuts are soft but still holding up at historically higher than normal prices. Thin meats and labor-intensive items are steady to slightly higher across the category as labor is an issue across all beef packers and specialty cutters. Grinds are soft and should continue to see lower levels into August.
Poultry | Chicken
The markets have once again remained in a neutral position and prices remain mostly stable. The processors are continuing to battle the labor challenges along with issues with transportation. The Jumbo, Medium and select breast meat markets have all remained flat all week. The production levels climbed up to 170 million head count after 163 million head the previous week. This is more in line with what we were experiencing prior to the Holiday and also above the levels being produced in 2020. The placements are remaining at a pretty consistent level, so we are not looking at any major changes in supply in the days ahead. We did see 56% of the birds come in the heavier weight ranges, so the total supply of meat is up. The wing market has also remained flat for the Jumbo, medium and small wings as well. There is concern as we enter the fall that the demand on wings is going to push the market to higher levels. The tenders have also remained at record level highs and are expected to continue to have pressure on them as we go into the fall.
The Jumbo Breast Meat market has remained flat and is trading at $1.84/lb. There was a little talk of some trading in back of the market, but pretty minimal. The medium and select markets have also remained flat at $2.08/lb on the medium and $2.84/lb on the select. Line run Breast Tenders took a very small increase and are trading at record highs of $2.81/lb for line run tenders and $2.91/lb for select tenders.
The wing market on all sizes remained flat for the week. Jumbo wings remained at the record high of $3.22/lb. The medium whole wings held at $2.84/lb and small wings also held to end the week at $2.94/lb. Without any extra supply of wings coming on and the demand remaining in place this is really going to turn out to be an interesting fall.