Market Updates for July 9, 2021

Section Type

Dairy | Eggs

Large - Up

Medium -No change

Small - No change

Retail demand mixed. Supplies of extra large and large well balanced and held confidently. Market steady to full steady.

 

 

Dairy | Butter

Butter- Down

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

Barrel -Up

Block -Up

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

The holiday shortened week expectations are for a harvest of 1.8 to 1.9 million hogs this week. Heat continues to reduce weight and with wholesale prices lower, processors are harvesting the animals available and not reaching for hogs which increases hog prices and pulls hogs off the market intended for later production. 

This week's lower kill could preserve prices at current levels, with forecasts that lower prices are coming when the harvest schedule returns to 5 days per week. 

Butt prices are lower this week and loin prices steady.     

Spare ribs are lower this week, with St Louis prices lower. Back ribs prices are stable to higher.   

Belly prices are declining again this week. Prices will increase next week. Shortages are possible due to the holiday and labor issues. 

 

 

 

Meat | Beef

Harvest numbers are currently out-weighing demand, prices peaked on most cuts, and are trading down at this point. Grade has slipped and select is now showing up putting further pressure on select cuts. Expect the select/choice spread to continue to be wide until we see some better grading. Exports have slowed down slightly and imports are sluggish coming in. Logistical issues are part of the issue.

Middle meats such as ribeyes are trading lower, select much lower due to the grade slippage. Striploins are coming down from their peak pricing. They should start to gain traction again soon as retailers step back into the market. Tenderloins are slowly coming down but are still somewhat tight in the market. Expect to see a slow descend for the remainder of the summer. Briskets are coming off quickly as retail interest was lost with the recent high pricing. We should get into a price point over the next few weeks where retail will step in and steady pricing. End cuts should continue to hold steady to slightly lower. Thin meats such as skirts continue to show strength. Imported skirts are tight so expect increased demand on domestic products. Grinds have shown strength into the 4th of July holiday pull week. They are starting to come off at this point but expect to see price holding steady at higher levels than previous years.

Poultry | Chicken

We seem to finally have found some stability on the pricing of most cuts of chicken with the exception of chicken tenders.  They seem to be highly sought after and buyers are willing to pay a premium to get them.  The major challenge that continues to trouble the producers is labor, but they are not alone in this challenge.  It is being seen in many industries.  The wages in the industry are going up, so hopefully that can bring some much needed relief.  The high cost of feed for the birds along with the lack of labor keep the industry from expanding.  The price levels we are seeing would normally lead to additional supply, but these other factors are keeping the supply level and costs up.  It does seem that the many cuts have hit the high point and have started to come down although at a very much slower pace than they went up.  The Jumbo, medium and select breast markets have all remained flat for the week.  The production levels were the highest we have seen in a while last week, but will fall off this week due to the shortened work week with the Holiday.  The total supply came in at 172 million head last week which was up 2 million head from the previous week.  The placements continue to hold, so there will not be any large increases in production coming up.  We will most likely continue to see the production remain at these levels until the labor situation improves or more plants can implement automation to help reduce the demand for labor.  The wing market has remained in a pretty good balance with only a small amount of softening on small whole wings.  At the record high prices for Jumbo whole wings it seems that we might have seen the top for now.  As menu prices have had to go up it certainly has curbed some of the demand allowing the prices to level off.                           

Breast and Tenders:

The Jumbo Breast Meat market remained flat and has remained at  $1.87/lb.  There is trading below these levels if you are willing to take the product in large combo bins.  The medium market remained flat at $2.08/lb and the select has also remained flat at $2.84/lb.  Line run Breast Tenders continue to increase and are now trading at a record high price of $2.77/lb.  The tenders seem to be sought after for the QSR segment.            

Wings:

There continues to be some offerings on small and medium wings.  At the levels they were at it is hard for the pizza restaurants to get the money they need for them.  The Jumbo whole wings however continue to trade at the record high of $3.22/lb.  The medium whole wings came off to $2.84/lb and small wings came off to end the week at  $3.04/lb.  The issue we are going to face on wings going into the fall is that the supply of any excess inventory in freezers is not there and when the fall demand hits it is expected to bring the market back up.