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Market Updates: December 29, 2016

Market Updates

Center of the Plate

Beef

Ground beef prices have bounced 30% higher in the last few weeks and continue to be supported by holiday-reduced production schedules. Rounds and chucks are in great shape, with asking prices trending higher. Strip features have cleaned up inventory, with higher asking prices being the rule. Tenders and ribeyes continue to adjust lower.

Pricing Trend

Ground Beef 81%

Brisket CHC & SEL

Inside Round CHC & SEL

Ribeye CHC & SEL

Strips CHC & SEL

Ball Tips CHC & SEL

Tenders CHC & SEL

Flank Steak CHC & SEL

Current Week

Up

Up

Up

Down

Up

Flat

Down

Flat

Next Week’s Projections

Up

Up

Up

Down

Up

Up

Flat

Up

Pork

Belly (bacon) prices are firming after the USDA Cold Storage report showed that frozen inventory actually shrank in November, a month that typically shows inventories building for the next summer season. Similarly loin, rib and trimmings inventory came in below last November. Prices for these items are also firming.

Pricing Trend

Butts

Hams

Spareribs

Loins

Bacon

Current Week

Up

Down

Up

Up

Up

Next Week’s Projections

Flat

Flat

Up

Flat

Up

Chicken

The USDA Cold Storage report showed both breast meat and wing inventories are unchanged from this time last year, which is relatively large. Leg quarters and dark meat inventories are significantly smaller than last year, confirming strong export movement. Jumbo breast meat and wings demand is still dull, with some discounting evident.

Pricing Trend

Jumbo BNLS/SKNLS Breast

Clipped Tenderloins

BNLS/SKNLS Thigh Meat

Jumbo Wings

Medium Wings

Current Week

Flat

Flat

Flat

Flat

Flat

Next Week’s Projections

Flat

Up

Flat

Down

Down

Turkey

The November Cold Storage report showed about 12 million pounds more whole turkeys after Thanksgiving than last year. Larger inventory and increased production will continue to pressure prices lower.

Pricing Trend

UB Hens, East, 12 lb. Frozen

UB Toms, East, 22 lb. Frozen

UB Turkey Breast, East, 8-10 lb.

Current Week

Down

Down

Down

Next Week’s Projections

Down

Down

Down

King Crab

Costs remain elevated through the holidays.

Mahi Mahi

Supply remains very short as new season supplies have yet to hit the states out of South America. For now costs and first offers remain elevated.  

Perch 

Perch supply is good on the Michigan sizes but remain short on the Ohio sizes.  

Pollock - Atlantic (1x Fzn)

For Lent the 2/4 oz. in IQF and shatters are all that are available until the start of the A season fishery in January. If this yields larger fillets we hope to see some of the larger 4/6 oz. and 6/8 oz. sizes in March.  

Sea Bass

Very short on supply especially on the large 8 oz. Costs remain firm.

Snow Crab

The snow crab market is trading at very high levels. There is very limited supply on all sizes more so on the smaller 5 / 8 size. We do not expect any relief on costs possibly until the new season in the spring. Canadian inventory is low. Alaskan inventory is low to non-existent (Alaskan quota has been cut by as much as 50%). Russian inventory is low. 

Shrimp-Tiger

The Black Tiger shrimp supply continues to be very tight on small shrimp. Packers are behind on orders resulting in limited new offers from overseas and in turn elevated prices. There is not expected to be relief until mid next year.

Shrimp-Domestic White & Brown

Domestic shrimp continues to be steady as the season slows down for the holidays. Raw materials are available, but premiums are noted on certain sizes where inventory is short.

Squid-Loligo

The global production of of Loligo squid species continued to be significantly below normal throughout 2016. Production in major areas such as China and India were most noticeably decreased, with production in some areas lower by up to 70% from 2014 levels. This decrease in availability has caused a shortage of raw material in areas which typically are major suppliers to the the U.S. cleaned squid market, and prices for imported cleaned loligo products have generally increased on a steady basis since August. The trend of strong prices and limited supply is expected to continue until the next season in south China, starting August 2017. 

Squid-Todarodes

Todarodes squid landings and pricing showed a similar trend in 2016 as Loligo. The catch was reduced and compared to 2015, and prices for raw materials doubled. Similar price increases were seen for finished goods. The next season, and opportunity for prices to return to towards the levels of previous years, is June 2017. 

Dairy

Dairy Category

Last Week

Current Week

Block Cheese

Up

Down

Barrel Cheese

Down

Down

Butter

Up

Up

Large Eggs

Up

Down

Medium Eggs

Flat

Down

Small Eggs

Flat

Flat

Cheese

The block and barrel markets will continue to converge closer to the traditional spread. Speculators feel that the barrel market will move more towards the block market in the coming trades. Demand in the market is strong but there has been multiple loads still coming to the market to be traded.

Eggs

Processed eggs are fully available. Within shell eggs, retail demand is fair. Supplies for extra large and large are long and the market is weak.

Butter

Spot butter pricing has spiked over the past few weeks and most believe that the biggest factor contributing to this recent run up is the cold storage report that came out a week ago. There was a significant pull on inventory from the previous month. While this is expected in quarter four, it was higher than the October to November decline in the last 5 years. It was still ahead of the previous year but is believed to have raised concerns for some as production appears to have slowed and inventories are reducing. Things should settle down as we move into the new year, but futures are still pointing for pricing to be above the $2.00 market.  

Grocery & Bakery

Wheat

Cash prices for milling grade high protein wheat have leveled out; flour prices are flat.

Pricing Trend

High-Gluten Flour

Semolina Pasta Flour

Current Week

Flat

Flat

Next Week’s Projections

Flat

Flat

Soybean Oil

Favorable weather is supporting expectations for a large South American soybean crop. Prices have consolidated around the low end of the USDA $0.35 - $0.38/lb. forecast range.

Pricing Trend

Soybean Oil

Current Week

Flat

Next Week’s Projections

Flat

Sugar

Many beet sugar suppliers are well-sold for 2017 and are holding prices firm. Cane sugar is trading in a range. Refiners with domestic supply are selling in the middle of the range; suppliers who rely on imports are at the upper end of pricing.

Pricing Trend

Sugar

Current Week

Flat

Next Week’s Projections

Flat