MARKET TRENDS | 8.19.2016
This notice is subject to change. Information printed is based on last received market data. Subject to change without notification. © 2016 US Foods, Inc. 08 - 2016. All rights reserved.
Trading and price movement with last week’s spot market was fairly mundane, with
only a few quotes deviating from levels earlier in the week to the end. Buyers’ interest
for adding inventory was muted, as they chose to wait until this week to analyze
weekend clearance. Very hot and humid weather in many areas of the country may
have played a role with restocking this week. Live cattle had sold between $116/cwt
to $118/cwt, prices that are steady to softer from week prior levels. Last week’s cash
cattle market saw the live animal trade in a range between $117/cwt to $120/cwt;
dressed carcass sales at $186/cwt to $190/cwt.
81/19 FINE GRIND: We did see a slight increase over the previous week and
we are calling the market firm over the next few weeks. We should see a moderate
increase as we get closer to the Labor Day holiday.
PEELED KNUCKLES: Slight decreases were reported this week, but we do
expect the knuckles to hold steady to slightly softening until the seasonal demand kicks in.
INSIDE ROUNDS: The market was mixed this week, with choice product off just
a bit and select and ungraded picking up a few pennies. They are expected to hold
fairly steady at this time.
BOTTOM ROUND FLATS: Although this market went slightly backward this
past week, we are still calling the market steady this week across the majority of the
grades. Look for increased costs out front as retail ad features will drive up costs based
on heavy demand.
EYE OF ROUNDS: A slight decrease was reported this week, but we still expect
the market out front to report moderate increases going forward with heavy demand
from retail and exports.
STRIPS: Strip loins continues to be under pressure as the packers continue to
discount this item to keep product moving. We believe we will continue to see lower
pricing well past August.
TOP BUTTS: With top sirloins we saw modest upward pricing on all grades last
week, and we are still projecting the market to remain unstable through August. We
should see higher prices as we get closer to the Labor Day holiday.
TENDERLOINS: The tenderloin market was flat on the choice grade and only up
slightly on the select grade but we all know that it will continue to go higher as we
move into the fall and winter months.
RIBEYES: Both light and heavy choice product took large gains last week and
continue to show strength going into the Labor Day holiday, while select product only
showed a moderate move up. We may see a slight downturn once we get beyond the
holiday before the fall and winter rallies occur.
CHUCK ROLLS: All grades reported flat this week, however, with the roasting
season and schools starting we do expect continued increases going forward well into
the fall months.
TERES MAJORS: Continues to be unstable across all grades as we saw a
minimal increase on the choice grade and a modest decrease on the select grade this
past week. This market looks as if it will remain unstable going forward.
BRISKETS: This week we saw a modest increase on all grades; however the
market indicators are showing brisket falling off once we get beyond the Labor Day
BALL TIPS: With Ball Tips, the market continues to rebound, and we believe we
could see moderate increases out front as the retail sector is actively featuring this
item on their ads. Look for increases to occur well into the fall.
FLAP MEAT: Despite the market indicators showing this as coming off, flap meat
took a moderate gain this past week. We still expect the market to lose value well into
the remainder of the year.
FLANK: All grades reported a modest increase in cost this week, and it is expected
to continue going forward until mid-to late-September.
SKIRT MEAT: The skirt steak market remains very unstable with declining pricing
reported last week. It is not out of the question we could see increased costs until
Labor Day, but after that we think we will see more downward price adjustments.
Base hog prices traded mixed in terminal and regional markets. Buyers are actively looking
to fill next week’s schedule, which is supportive for live hog prices. Last week harvest
numbers came in above year ago levels and this week’s slaughter is also expected to come
in above year ago levels. Looking ahead, supply estimates for August are expected to come
in about 3% above year ago levels. From the supply perspective, this means more pork in
the pipeline during August and growing uncertainty about the large supplies of pork during
the last half of the year.
Hog weights continued to move lower week over week. Warm temperatures and high
humidity continue to impact live weights, but producers may be moving hogs to market
early to avoid declining live hog prices. Hog weights are expected to continue their seasonal
decline through the August time frame. Producer margins are expected to remain steady to
slightly profitable through mid-September.
On the demand side, week over week demand for commodity pork cuts remains lackluster
for the majority of the cuts. On the processed meat side, demand for hams has started
to slowly gain momentum while demand for bellies remains steady. The outlook for the
month of August indicates ample pork supplies with varying levels of domestic demand and
uncertainty for export demand. This may result in a volatile pricing for pork items during
Prices for bone-in loins moved lower week over week, while boneless loins found price
support and moved slightly higher. Ample product supplies, slowing retail demand and
increased availability of competing meats is expected to put downward pressure on
prices through early/mid-September.
Pork tenderloin prices posted significant declines week over week due to a lack of demand
and ample supplies. Tenders are expected to trade lower through late month and may firm
mid-September. Concerns regarding ample product supplies may put additional downward
pressure on prices.
Pork Butt prices moved lower week over week with additional declines posted this week. Prices
are expected to gradually move lower during August, but may firm late month due to retail
interest for Labor Day promotions. Increased export demand may support current price levels
over the next few weeks.
Spareribs and St. Louis Rib prices traded steady to slightly higher week over week due improved
retail demand for Labor Day promotions. Prices for Spareribs and St.. Louis Ribs are
expected to move lower after Labor Day. Back Rib prices moved lower week over week and
are expected to trade steady to slightly lower through August. Overall spareribs and back rib
prices are expected to continue their seasonal move lower during September.
Bacon/Belly prices continued their move lower week over week pressured by ample
supplies of fresh product. While bacon demand is expected to remain strong during August,
belly prices are expected to remain volatile as supplies of fresh product remain plentiful
and packers attempt to clear their inventory. The long-term outlook for bellies indicates that
prices are expected to move lower through September.
Ham prices firmed last week and traded slightly higher. Prices are expected to trade steady
to slightly higher through August supported by improving export demand. Long-term price
outlook for hams indicates a risk of increased price volatility during August/mid-September
due to the changing level of export demand.
The following market dynamics will impact hot dog and breakfast sausage pricing during
the September time frame. Pork trimming prices traded slightly lower during the late July/
early August time frame; thus prices for breakfast sausage are projected slightly lower for
September price lists. On the other hand, sow prices moved higher during the late July/
early August time frame; thus Whole Hog Sausage prices are expected to be higher for
September price lists. On the beef and all meat hot dog side, lower beef trimming prices
during August will result in higher prices for All Beef Hot Dogs during September.
The following market dynamics will impact Dinner Sausage prices during the September
time frame. Pork picnics prices traded higher during late July/early August supported
by increased seasonal demand. Thus Dinner Sausage prices will be slightly higher for
September price lists.
BONELESS SKINLESS TURKEY BREASTS
The turkey breast market was flat as demand will not return until later in the year
FOR INFORMATION ON THE BIRD FLU, PLEASE REFER TO
US FOODS ® "YOU NEED TO KNOW" - AVIAN INFLUENZA UPDATES.
WHOLE FROZEN TURKEY
Whole turkeys should remain flat to slightly up for the next three to four months.
AVIAN INFLUENZA (AI) UPDATE:
Customers should remember that although there has not been any recent news of Avian
Influenza outbreaks, the supply pipeline is still recovering from last year’s extreme effect.
Barring any further setbacks, the earliest can we expect to see a return to normalcy in
supply would be at the end of August.
As a reminder, this issue is not a food safety issue. There have been no human infections
associated with avian influenza viruses of this particular subtype (i.e., H7N8). If there is
any further concern, customers should know that the proper handling and cooking of
poultry and eggs is to cook to an internal temperature of 165°F – which kills bacteria and
viruses, including Avian Influenza. (Updated March 11, 2016)
The National Chicken Council released new findings indicating that U.S. chicken
consumption remains high, showing that 2016 levels have exceeded those levels for
2014 and 2015. According to new research in the two weeks leading up to the survey,
87% of consumers ate a chicken meal or snack purchased from a supermarket and 72%
ate a chicken meal or snack from a foodservice establishment. Supermarket numbers
increased 2.4% and are now at parity with those seen in 2015, while foodservice
establishment consumption shows a 7.5% increase from 2015.
Broiler-Type Eggs Set in the United States Up 1 Percent
Hatcheries in the United States weekly program set 217 million eggs in incubators during
the week ending August 6, 2016, up 1 percent from a year ago. Hatcheries in the 19
State weekly program set 209 million eggs in incubators during the week ending August
6, 2016, up 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-Type Chicks Placed in the United States Down Slightly
Broiler growers in the United States weekly program placed 179 million chicks for meat
production during the week ending August 6, 2016, up 1 percent from a year ago. Broiler
growers in the 19 State weekly program placed 172 million chicks for meat production
during the week ending August 6, 2016, up 1 percent from the year earlier. Cumulative
placements from the week ending January 9, 2016, through August 6, 2016, for the
United States were 5.52 billion. Cumulative placements were up 1 percent from the same
period a year earlier.
WHOLE CHICKEN AND CUT-UP PARTS
The demand for small birds is still extremely strong. Expect this market to continue trending
sideways to slightly up.
BONELESS, SKINLESS BREASTS AND
The entire breast market was up this week as was the tenderloin market. This trend should
continue over the next few weeks. The breast market is being affected by the intense heat
and bird weights.
The wing market was up this week as demand has started to pick up even more. Supply
is tight and will get tighter as demand is still exceeding supply. Unfortunately, there are no
extra wings to go into the freezer to cover the shorts during wing season. We will continue
to look for opportunities.
BONELESS, SKINLESS THIGHS
The market was up this week and it looks like there may be a little more upside in the next
couple of weeks due to the labor issues they are experiencing.
SOY AND CANOLA OIL
In a strong counter-seasonal move, the soybean oil futures and basis markets have posted
significant gains since late July. The primary drivers behind this rally are: strength in the
global palm oil market on lower stocks and stronger Chinese demand; continued solid
pace of the U.S. soybean oil exports - U.S. dollar still headed lower; record use of soybean
oil for biodiesel production in the U.S. ahead of elections; large drop from June to July
on NOPA domestic bean oil stocks despite high yields; and commodity fund (speculative)
traders have flipped from net short to net long positions. We’ll be looking for a pullback
late August/September to push pricing closer to $0.31. Current market at $0.34
• The U.S. soybean crop is currently rated at 72% good to excellent. That is the
fourth highest level of the past 30 years for this point in the growing season.
Record yields are expected at this point.
• The USDA’s August supply/demand report raised the soybean ending stocks
estimate by 40 million bushels for the 2016/2017 crop year. However, the
USDA lowered its soybean oil ending stock estimates significantly in August,
recognizing a record pace of soybean oil used for U.S. biodiesel production ahead
of elections and increased export business – U.S. dollar still headed lower.
• Soybean oil’s share of product value has rallied over 4% since early July at the
behest of a sharp drop in soybean meal values. Current fundamentals suggest a
move to 36% in the spot position is likely.
• Palm oil prices made two-month highs this week on lower than expected July
stocks in Malaysia and stepped up buying from China. Seasonal production
increases have started out at a lower than expected pace.
• Crude oil has been able to stay above the $40 per barrel level (profitable bio
margins), contributing to posted gains.
• The USDA lowered its soybean oil ending stock estimates significantly in August,
recognizing increasing export business and a record pace of soybean oil used for
• Soybean oil prices have a strong seasonal tendency to move lower in the months
of August and September.
Butter production is mixed across the country as cream supplies are uneven. We are nearing
the time frame when prices skyrocketed the past two years. The market fundamentals are
not supporting another $3.00/lb high as stocks are higher than year ago levels, production is
up and retail holiday bookings were active earlier this year. There is still some risk with the
skyrocketing prices, but we could also see a significant decrease as sellers look to unload
MILK AND CREAM
Bottle milk sales are up, as is demand. Production remains steady across the country except
in the West where high temperatures have been disrupting the cows. With back to school
upon us we will continue to see a rise in demand and pricing. FMO commodities for August
were all up except for class II butterfat. California commodities were all up.
Cheese prices have continued to climb each week since May. It seems as though lower than
expected production and higher than forecasted demand continue to be the drivers of the
higher markets. Markets were not expected to be trading this high and until demand lets off
we will continue to see the higher market. Expect markets to continue to trade within the
current range with upside expected in Q4.
Retail demand patterns are good with more promotional activity and schools coming back in
session. Wholesale buying interest has been active this week, with bids to buy now exceeding
current offerings. Prices have increased due to the increased demand and tightening supply.
This trend should continue for the near term.
(WHITES AND BROWNS): New season opened as scheduled on Monday,
August 15. The fleet is out shrimping and we expect to see shrimp to the dock this weekend.
Prices continue to rise as we leave the spring catch and inventory is low.
DOMESTIC PUDS: New season opened Monday, August 15. There is a shortage of
(BLACK TIGER AND WHITES): Black Tiger Shrimp 26/30 and smaller are starting
to firm up in price. Tiger inventory is low and we feel pricing will continue to rise as we get
closer to the holiday season. Farmed whites, both Asian and Latin America, are seeing price
increases. This market is unstable with pricing and product.
(MEXICAN BROWNS AND WHITES): Mexican farmed shrimp are seeing a
decrease in production. This will have an effect on Asian and Latin American Whites. Wild
Mexican shrimp should get in full harvest swing by the end of August.
CATFISH, DOMESTIC & IMPORTED
DOMESTIC: With this warm weather pattern in the South, farmers are now able
to feed fish daily. Fish are growing fast but the warm weather has caused algae
blooms that have caused off flavors, so harvest has been slow. Outlook is for a good
season, late but good.
IMPORTED: New season produced a fair amount of fish. Prices remain high due
to USDA bill and uncertain costs associated with inspections. We are going to see
higher pricing next week. Long-term outlook for the summer is higher pricing.
CHILEAN FARMED SALMON: The fresh market is now firm on fish from Chile.
Fish from Europe and Canada are seeing higher prices. However, frozen portions remain at a
premium as those fish were priced during the strike and continuing algae bloom. Wild fresh
Salmon catch is now reported to be lower than expected.
The Mahi season for the most part is over in Peru and Ecuador. Fishing was subpar
on larger fish, causing high prices and low inventory. Most feel the Central and South
American product is the best quality. Make sure you are comparing “apples to apples” on
Country of Origin.
SEA: Pricing is starting to see signs of weakening 10/20, and 20/30 Dry Scallops could
be at or near the bottom.
BAY: Pricing is now steady, but we feel there is some more upside to this market.
Inventory is tight.
Pricing is unstable with reports of a drought and salt water entering the ponds. Inventory in
the US seems to be good; replacement cost seem to be trending lower.
We are seeing an uptick in prices that will happen as new product starts to hit the US. We
expect to see unstable to higher pricing as the USDA starts to take over inspection of Imported
Catfish. There have been some Vietnam producers shut down due to lack of profits. Shortages
of small fillets (3-5 oz) are causing this price rise.
COD: The market for Atlantic and Pacific Cod continues to see stronger pricing. It is expected
to see cod pricing higher than haddock this year. Pacific Cod fishing was a good catch.
POLLOCK: The fishery for Pacific Pollock has produced just smaller fish
(2-4 oz ) fillets. This could cause an inventory issue for once frozen loins if they
don’t start catching larger fish.
HADDOCK: Production seems to be in good shape with continued fishing.
Additional fish from the Bering Sea are keeping pricing down. Some suppliers feel we
can see these lower prices through Lent 2017. Summer fish are being harvested. This
will be softer flesh fish and we may see this fish at a discount
(FROZEN STEAKS & LOINS): Tuna is fairly stable in pricing and inventories are good.
The catch in Central and South America has been slow, with mostly smaller fish being caught.
We could see higher pricing as this fish hits the market.
(RED & GOLDEN): King Crab pricing is unsteady at this time. Inventories are
getting low and we could see higher prices throughout the summer.
(BLUE & RED, PASTEURIZED): Imports on Blue and Red Swimming crab are
stable and pricing seems to be steady at this point. Mexico is now on conservation on the
ALASKAN: Vendors are reporting they are out of product and will not have any more until
the new season. The new quota should be out by the end of October.
CANADIAN: Pricing moved up a little this week but many think that we are at or near the
top. We are seeing retail step into the market in these summer months, keeping pressure on
the 5-8 market both in price and inventory.
NORTH AMERICAN LOBSTER: Production is picking up and we could see
more inventory soon. With any luck this will lead to lower pricing.
LOBSTER TAILS WARM-WATER: Warm-water tails are now steady on all
LOBSTER MEAT: Pricing remains firm, and inventory is tight.
Russet: Burbanks are done with Norkotahs in full
production. Current market is flat with exception to 80s
and smaller. Non-Idaho russets from Washington are down
again on all sizes, while Wisconsin is starting up.
Reds: A lot of reds are available in Wisconsin and
Washington. Current market is down over last week as
Yellows: Yellow potatoes are tighter which caused
the market to go up over last week from Washington.
Wisconsin just started and should have more volume
Chinese Peeled Garlic pricing continues to be high this
week and supplies continue to be limited. The process of
peeling the new California Garlic crop remains slow due to
lack of curing. Skins hold tighter on the cloves which slows
the peeling process.
Cabbage market is mixed this week. Cabbage out of
Oxnard District California and Western/Central New York
are down. Cabbage out of Michigan is up. Cabbage out of
Central Coast California is flat. Supply is light and demand
Red and Green Leaf: Quality and supplies are good with
good demand, but the market is slightly up over last week.
Current concerns continue to be insect damage, fringe burn,
brittle, light dehydration, frog skin, occasional seeder and
leggy. Weights are generally 20 to 24 lbs in both red and
Romaine: Unlike the Red and Green Leaf, market is slightly
down over last week with more volume. Current quality
issues include insect damage, fringe burn, brittle, light
dehydration, frog skin, occasional seeder and leggy. Weights
are around low 30s to low 40s.
Sizing has become more consistent but peaking still
on jumbos and mediums. Washington has increased its
volume, which has forced the market to go down again
on all sizes. Idaho and Oregon also have good volume
and the overlap is causing the market to go down. New
Mexico and California are winding down and should be
Chile pepper market is mixed this week. Jalapeño and
Serrano markets are up. Poblano peppers are down.
Supply and demand are moderate.
Supplies are mainly coming out of Michigan. Demand
continues to be sluggish. There are quality issues with
the product, which is causing lower volume. The current
market is flat over last week. Western cucumbers are
out of Baja and quality is extremely variable. Market
is generally steady as demand is weak. Supplies are
expected to remain tight for the next 10 days to two
weeks when new fields will come into production.
Yellow Squash: Supplies are mainly coming out of
Michigan. Demand continues to be sluggish. Quality
issues are appearing due to weather. Market is slightly
up over last week.
Zucchini: Michigan is the main sourcing region. Current
market is slightly up over last week. Supplies in the West
are coming out of Santa Maria and Washington. Quality
is good but becoming variable.
Green bean market is mixed this week. Round Green
Type are up. Haricot Verts are down. Supply is light and
demand is light.
Supplies and demand are good, which is keeping the
market flat over last week. Common issues include
brittle, insect damage, misshapen, big vein, mildew and
mechanical. Solidity has been irregular and ranges from
fairly firm to firm. Head size is generally medium to
medium plus. Weights are ranging from high 30s to
Michigan is the main sourcing region. Current market is
flat over last week. Quality is good.
Green: Growing regions out of Tennessee, North Carolina
and Michigan have reached a lot of rain this week. Market
is slightly lower this week. Quality is generally good but is
becoming variable due to the weather. Western supplies
continue to be weak but demand is even weaker. Market
is slightly down on all sizes compared to last week.
Red: Supplies are improving which is causing the flat over
last week. Quality is variable.
Rounds: Supplies continue to be fragmented and light
in Alabama, Virginia, South Carolina and North Carolina.
Demand is picking up which is causing the market to
go up over last week. Hot and rainy weather has caused
volume and quality to be spotty. Vine ripes continue to
cross at Baja and McAllen. Some vine ripes are crossing
through Nogales. Supplies are light, paired with increasing
demand, has caused the market to go up over last week.
Quality is variable.
Romas: Like the rounds, Roma supplies are light and
fragmented in the East. Market is down on all sizes over
last week due to light demand. Quality is variable due to
heat and storms. Western supplies continue out of Baja
and California. Supplies for larger romas are becoming
short, which caused the market to go up on large.
Excessive heat is causing some quality issues.
Cherry and Grape: Cherry supplies and demand are light.
Market is slightly up over last week. Grape supplies continue
out of North Carolina and Virginia Eastern Shore fields.
Current market is slightly down over last week. Western
grapes continue out of Baja but supplies are lighter, which is
causing the market to go up. Quality is variable.
Carrot market is mixed this week. Carrots out of Kern
District, California are flat. Carrots out of Mexico crossing
through Texas are down. Supply is good and demand is
moderate. Quality is good.
Celery market is mixed this week. Celery out of Michigan
is down. Celery out of Salinas-Watsonville, California
is down. Celery out of Santa Maria, California is down.
Supply and demand are good. Quality is good.
Green onion market is up this week with light supply and
moderate demand. Light supply is due to lighter supplies
out of Northern Mexico. High temperatures and humidity
have the slowed growth. Expect lighter supplies to
continue through the month of August.
Cauliflower market is up this week with moderate supply
and good demand. Quality is good.
Asparagus market is mixed this week. Standard, large and
jumbo asparagus out of Peru is down while extra large
and small asparagus is up. Asparagus out of Mexico is
up on both standard and large. Supply is fairly light and
demand is good.
Broccoli market is mixed this week. Broccoli out of
Salinas-Watsonville, California is down. Broccoli out
of Santa Maria, California is up. Supply is steady and
demand is light. Expect supplies to be steady over the
next few weeks. Quality is good.
Import volumes on Gold Pineapples continue to be up every
week as expected. We are in the “pre-fall” push where size
profile is larger and overall availability is strong in support of
the coming holiday ads. Quality is excellent with high sugar
The banana market has improved as volume picks up.
Plantings and harvest are aligned for full production with
school starting. Volumes are good and fruit quality is strong
Supply is abundant with good volume.
Quality is good and prices are reasonable.
The ever-changing avocado market continues to make
headlines as this weekend brought another change to the
Mexican harvest. Floor inventories at shipping point and the
border cleaned up and harvest halted. The size profile has
shifted from a smaller profile to a larger pack, where 48s and
60s are now more abundant. Markets are not softening, as
demand has picked up too.
Cantaloupe: The market is mixed as some growers
are peaking on small fruit. 9s and larger are keeping
strong demand. The overall quality is excellent with a
nice clean, tight net occasional green cast, but mostly
Honeydew: The market is steady with good supplies
across the board peaking on 6s. The overall quality is
excellent with nice, clean fruit
Steady volume with consistent good quality. California
volume trending higher.
We are seeing this market start to tighten up. Prices
are slightly up and supplies are getting tighter. Due to
recent weather conditions, it slowed production and
resulted in smaller size fruit. Production is good while
quality is average to good. We are seeing a decline in
Dark sweet cherries out of Washington continue to be
steady in supply. Mid-July volume is expected to drop
off quickly, and harvest will finish by month’s end.
Market prices remain steady.
The grape market is steady with good to fair demand.
Growers are harvesting all throughout the San Joaquin
Valley and will continue through November. The overall
quality of the fruit has been very good with excellent
color on the reds.
APPLES & PEARS
Galas from the Northwest have opened up with reasonable
pricing and good quality. There is a slight push on large Fujis.
Movement on most apples remains steady. California pears
are stable with movement and quality remaining unchanged.
The market is steady to strong as growers are trying to finish
up the coastal regions. Mexico has started in a light way and
volume will increase more in the coming weeks. The overall
quality of California fruit is fair, with a wide range in maturity
and some clear rot is showing up across the board. The first
Mexican fruit looks very good.
Market is very strong on 113s and smaller as growers are
peaking on some bigger fruit. The 138s are in a demandexceeds-supply
situation until California navels start around
the first of November. The overall quality of the fruit is good,
with some fruit showing heavier green color due to our hot
temperatures and the natural reaction of a later season
Valencia. There are some Chilean navels that have some very
nice deep orange color that have arrived on both coasts.
California navels will start around the first of November and
go through about June.
The lime market continues to rise and is expected to
continue upward and stay strong. The rain in Mexico is
hurting the volume of fruit being harvested, but good yields
are expected when the rain subsides. Quality remains good
and all sizes are available.
Blueberry season is at its peak. Steady production and
supply. Quality is good.
Supply is steady. Some growers are gapping in
between varieties. Demand has increased slightly with
much smaller volume.
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