top of mind news
- Colo. Looks To Expand Overtime Eligibility
- Unexpected Gaps in Your Restaurant’s Insurance Recipe
- Restaurants in 2030: More Tech, Less People, Lots of Unknowns
- Why Lawsuits are Taking Aim at Quick-Service Meal Pricing
- Smart Strategies For Making A Diabetic-Friendly Menu
Chicken production for the week ending November 9th, while off modestly from the prior weeks, remained 6.2% better than a year ago. While more chicken supply is hitting the market, its continuing to temper prices across wings and leg quarters but chicken breast meat prices are firming after establishing a likely seasonal bottom in early November. Egg prices, as well, continue to rise, and the upside momentum has been abrupt recently. Egg demand typically escalates before the fall and winter holidays baking needs increase. Anticipate the egg markets to remain elevated compared to a year ago, but prices should begin to ease heading into early 2020.
Last week’s beef production edged .9% above last week and last year, but cattle grading USDA Choice remained low. So, choice beef output is running well behind last year. The choice cutout value is holding substantially higher than a year ago, and those increases are being led mostly by the end meats, beef trim and grinds. Seasonally, price relief is likely for ground beef items, but given the continued interest in ground beef and burger features over whole muscle cuts, the downside potential may be tempered. Plus, escalating imported beef prices are keeping a floor under the trim and grinds, another supportive element.
Pork production continues to post substantial year-over-year gains, with last week’s output up 2.3% from the week prior and 4.6% above last year. Amid escalating pork output, sizable price increases are being noted across the ham and belly primals plus ribs and picnics are posting gains as well. Export interest remains the supportive price driver when weekly spot sales declined abruptly then value was perceived, and prices began to rise. Both belly and ham prices have recently notched sizable declines this week, but further weakness isn’t expected going forward.
The snow crab markets remain historically inflated. U.S. snow crab imports during September were 7.8% larger than the previous year. But tight world supplies are expected to underpin the snow crab leg markets for the next several months. This is despite the Alaskan snow crab quota set 24% above the prior year and the largest in four years. The majority of the Alaskan quota isn’t expected to be landed until after the holiday season.
The potato markets remain expensive due to the cold temperature experienced earlier this fall. This hampered the end to the harvest and storage supplies. The USDA is estimating the total 2019 potato harvest at 422.5 million hundredweight, down 6.1% from the previous crop. Idaho production is estimated at 134 million hundredweight, down 5.5% from 2018 and the smallest in four years. Potato shipments are starting to improve which could bring some price relief. However, tighter supplies could dampen any downside price risk potential. The avocado markets are steady.
THE KITCHEN SINK
The cheese markets are seasonally declining, but barrels are still inflated for this time of year. U.S. milk production in October was 1.3% more than a year ago. Dairy farmers added 5k head to the dairy cow herd for the month and adjusted their September figure from down 7k to up 5k which is good news for pending milk output. History says to expect further cheese price drops into late-December. The butter market remains soft due to good production and adequate stocks. Butter prices haven’t been below $2.000/lb. for a notable time since 2016. Nonfat dry milk prices are strong, recently making a 56-month high.
The wheat markets generally are tracking below year ago levels with the exception of durum. Challenges with the Canadian durum crop has caused durum prices to firm. But total world wheat supplies are adequate. And unless notable crop challenges occur in Russia, general wheat price inflation may be tame.
Crude oil futures are steady since last week but are higher this month. Rising tensions in the Middle East, including instability within Iran are supporting the crude oil markets. The quarterly pivot model says $61.45 (WTI) may be achieved.