Weekly
Market Update Report
Perishables
& Non-Perishables
DATE:
February 4, 2009
Dairy
CHEESE:
Barrels
closed at $ 1.1150 and 40# blocks at $ 1.1500. The weekly average for
barrels is $ 1.1055 (+.0080) and blocks, $ 1.1245 (+.0545). Cash
prices recovered from levels at or below the CCC (Commodity Credit
Corporation) purchase prices at the CME (Chicago Mercantile Exchange)
cash cheese market, closing the week at $1.1500 per pound for blocks
and $1.1150 for barrels. Sales and offers in Chicago were heavy as
sellers tried to clear surplus cheese produced during the year end
holidays before it reached the 30 day age limit for current cheese
sale. Sales for the week totaled 46 loads. Cheese producers have
been reluctant to sell extra cheese at current prices. Pizza
promotions, often tied to the Super Bowl, including those with larger
amounts of cheese, may also clear supplies. Cheese production remains
seasonally active.
(Source:
USDA Dairy Market News, Week of January 26-30, 2009)
BUTTER:
The cash butter price at
the CME Group held steady all week at $1.1025, 5 1/4 cents higher
than the support price. Butter continues to clear to CCC from Western
producers. Government clearances through January 30 total nearly 2.1
million pounds. All of these clearances have occurred in January.
Churning schedules across the country are seasonally active. Cream
supplies are reported to be readily available to most butter
producers. Often, butter producers are selective and cautious with
their cream purchases. When possible, many butter producers are
churning in line with known and future needs, although surplus butter
is clearing to inventory in many parts of the country. According to
the NASS Cold Storage report, butter stocks at the end of December
totaled 118.9 million pounds, down 23% or 36.2 million pounds from
last year. Stocks were down only 1% from November. Butter stocks in
CME approved warehouses were 66.3 million pounds for the week ending
January 24, up 3.1 million pounds from the previous week. The weekly
level compares to 94.3 million pounds in 2008 and 88.9 million pounds
in 2007. In the past four weeks stocks have grown by 29.3 million
pounds. This compares to 21.8 million pounds for the same period in
2008 and 36.1 million pounds in 2007. Butter demand is fairly good
across the country. Retail orders are occasionally being spurred by
retail feature activity while food service orders remain below
expectations. Export activity out of the U.S. was very active in
2008, but many traders and handlers project 2009 exports to be much
lighter.
(Source:
USDA Dairy Market News, Week of January 26-30, 2009)
MILK:
Milk production is steady to higher seasonally across the country.
The impact of lower milk prices is causing increased pressure on the
dairy sector. Increased culling of dairy cows is taking place in most
regions. Replacement animal costs are declining with one Western
auction reporting heifer prices at levels last seen in 2003. Milk
processing continues to be tested in California where plants are
running at capacity and milk and components are being moved to other
states to find help. Plants in the Northwest are running at normal,
projected levels following several weeks of winter weather
conditions.
In
the Midwest, milk is steady with little changes noted. Icy conditions
impacted the middle Atlantic region. Milk shipments and buying
patterns were affected by icy roads and loss of power.
(Source:
USDA Dairy Market News, Week of January 26-30, 2009)
EGGS:
As we end the month of January, retail demand remains mixed, and
generally slowing around the country. Completed wholesale trading
activities still offer varying degrees of economic support to
existing quotations. There is a wide disparity in the values of
certified and non-certified acquisitions. Supplies of the larger
sizes are increasingly available, while that of the lighter weights
are adequate, generally, for current requirements. Eggs for breaking
are still not aggressively sought, and some supplies here are finding
their way into the cartoned market. The overall volume of acquisition
interest is severely limited. For egg products, while there is at
least a modicum of pressure being exhibited throughout this entire
sector, liquid yolk is at the head of the economic downturn. Because
current values here translate into thin margins for the dried
equivalent, sellers of dried yolk are currently reluctant to
negotiate pricing structures with potential buyers.
(Source:
Urner Barry Market Update - January 30, 2009,)
Commodity
Meat: Beef, Poultry, Pork
Boxed
Beef Overview:
Chuck
Meat: Soft
Retail
interest in Chuck meats is limited. Packers are carrying inventory
from last week into this week. Export demand is quiet.
Rib
Meat: Firm
Packer’s
successful sold Rib inventories through February once the bottom of
the market was identified. Expect prices to inch higher.
Loin
Meat: Soft
PSMO
Tenderloins are building rapidly in packer inventories and will soon
demand attention. Anticipate spot market prices in the range of
$6.50 FOB or lower to create the sales need to move aging
inventories.
Strip
Loins and Top Sirloins Butts have not enjoyed the same momentum as
the Rib complex. Both Strip Loins and Top Butts are soft this week
and will likely trade lower.
Round
Meats: Steady
There
is nothing exciting to report in the Round complex. Expect prices to
be steady. Demand is doing no
more
then keeping pace with production. Some trade is possible depending
on the packer and inventory
position.
Ground
Beef: Decreasing
For
weeks, Ground Beef was the only item in the Beef complex that was
healthy. Packers took the opportunity to ride prices sharply higher.
Ground Beef is now meeting price resistance and moving lower. To
compound the issue, 90% Lean Cow Meat has declined in value and is
putting additional downward pressure on the Ground Beef complex.
PORK:
Weekly
harvest numbers continue to decline, but recently released data shows
a majority of these declines are from packers reducing their Canadian
hog harvest numbers in response to the MCOOL regulations. Cutbacks
that are US herd driven have been minimal as of last week, but are
expected to pick in the near future.
Hams:
Steady to Firm
Hams
continue to perform poorly due in most part to export concerns with
Mexico. Short term forecasters are calling for steady to firm prices,
but overall price expectations for the near future have been lowered.
Bacon:
Steady to Firm
So
far bellies have been under performing due in most part to lack of
foodservice demand. This past week we began to see some movement
towards higher mid 70’s prices on the heavily traded 14-16#
bellies. Forecasters do not believe we have enough demand to push
prices into the low 80’s, but are calling for prices to inch a
few more pennies into the high 70’s. In addition, with supplies
reduced there is very little downside potential and forecasters do
not expect a repeat of the sharp declines we saw in February and
March of 2008.
Loins:
Steady to Firm
Recent
efforts by packers to boost loin prices, to make up for less than
stellar ham and belly trades, were thwarted by retailers who remained
cautious with their purchases. Prices are forecasted to remain steady
on bone in loins while boneless loins are expected to increase about
a nickel by the end of February due in most part to export demand.
Butts:
Steady to Firm
Butts
remain a good value and are forecasted to move slightly higher due to
smaller February product
Spare
Ribs: Steady to Firm
Prices
are holding firm at $113/cwt, and forecasters continue to call for
steady to slightly higher prices for the short terms.
Trimmings:
Steady to Firm
Forecasters
continue to call for a small amount of upside potential on both the
lean and fat trim markets. However, slower export concerns continue
to dampen their calls for major upside potential. Look for a few
small shifts here and there, but nothing to dramatic on either trim.
POUTLRY:
Chicken:
We
expect the market as a whole to be steady for the next week. This is
mostly due to the aftermath of the Superbowl and weather issues.
There may be localized areas of the country of market strength or
weakness depending on producer’s ability to produce and ship
product. We expect tenders and wings to be steady this week and then
weaken thereafter as the focus moves to other items on the menu. No
new news in dark meat. Exports are steady on consistent export
volumes. Financing concerns have limited the upside potential on the
demand side. Although markets have came off their lows from several
weeks ago we are now at a plateau that looks to hold for a week or so
before boneless breast begins its march up and wings begin to move
down.
Turkey:
Smaller
birds held steady for the week. Some weakness on mostly sideways
trading was seen in the larger birds. We continue to hear about
producer cutbacks and see their intent in markedly lower poult
placements. With the general state of the economy commentators are
hazy on just how this will affect prices for Thanksgiving.
Seafood
The
shrimp market continues generally steady except for a few spot
shortages of items that have seen some strengthening. Inventories
while fully adequate to ample do not appear burdensome. Overseas
replacement offerings are firm and in many cases disconnected with
current spot offerings. Given these market conditions sellers are
less likely to discount offerings despite a quiet demand.
Gulf
Domestic Shrimp: The rate and volume of sales continues to vary
by seller, however the overall climate remains somewhat dull.
Offerings vary widely, especially in the sizes around 16-20 count
shrimp. All sizes of HLSO brown shrimp were unchanged, as were most
sizes of white shrimp. However, additional discounts were taken on
both U/15 and 16-20 count white shrimp which continue to be the most
heavily supplied. Additionally, some offerings on 16/20 count shrimp
have been noted significantly lower than listed levels, though are
isolated. PUD’s were unchanged. In regards to supply, the NMFS
has made some revisions to their final report on Gulf landings.
According to the December report, U.S. Gulf domestic shrimp landings
for December 2008 totaled 8.323 million lbs. (headless weight)
compared to 8.273 million in December 2007, bringing the 2008
cumulative total to 101.357 million lbs. or roughly 19 percent below
last year.
Domestic
Shrimp
UB |
Mexican
White Shrimp: Selling
pressure is reported on Under 15 and 16-20 count white shrimp with
some discounting noted. Brown shrimp are steady.
Mexican
Shrimp
UB |
Chart
based on monthly data
White
Shrimp16-20 count Mexican farm-raised whites adjusted slightly
lower. The 26-30 and 31-35 count HLSO shrimp from all areas are full
steady to firm as on-hand supplies are reported limited. The balance
of the market is steady. Head-on shrimp are steady.
Vannamei
Shrimp
UB |
Chart
based on monthly data
Black
Tiger Shrimp: 26-30 and 31-40 count HLSO black tiger shrimp are
full steady to firm with a few higher offerings noted amid a tight
supply. The balance of the market is about steady as larger counts
are subject to some discounting.
Tiger
Shrimp
UB |
Chart
based on monthly data
North American Lobster Meat &
Tails
Maine
production was reported as nil. Market prices reflect product of
Canada only. Although the Canadian
supply
has been reported as fully adequate, many sellers reported paying
higher prices for replacement product. In addition to the rising
costs, an increase in demand was reported. Both contributed to the
firm market conditions
UB |
Chart
based on monthly data
UB |
Chart
based on monthly data
West
Australian Lobster Tails: The market continues weak as sellers
are motivated to move off inventory in a quiet to dull market. 7-8
oz. tails are offered higher than B’s. New season production
will soon be available to the market.
Warm
Water Lobster Tails: The market is about steady at listed levels
with some limited discounting noted except for 8 oz. tails which are
full steady.
UB |
Chart
based on monthly data
King
Crab: The market remains unchanged. Larger red king crab is
steady to full steady with a few higher offerings collected. Smaller
count red crab ranges steady to about steady for a quiet demand. The
brown king crab market is steady.
UB |
Chart
based on monthly data
AK
Opilio: Product is starting to trickle down from Alaska.
UB |
Chart
based on monthly data
Pasteurized
Crab Meat
A
weak market was reported on Fresh Venezuelan meat as well as
pasteurized Indonesian meat. The lack of demand was cause for the
falling prices. Some sellers of fresh meat reported a loss of sales
to pasteurized product. With a slowdown in demand, and the economy in
general, some buyers are unwilling to hold fresh product. Burdensome
inventories of Indonesian meat caused sellers to offer deeper
discounts today. The market for Chinese meat was about steady. Some
weakness was noted on super lump.
UB |
Chart
based on monthly data
Scallops
The
markets continue to be dull and largely unchanged. Discounts were
noted on 30/40 count IQF scallops from Canada given a slightly more
abundant supply situation. Please note the additional column that has
been added for Chinese Sea Scallops. Quotes will appear shortly.
UB |
Chart
based on monthly data
Pangasius
Hypophthalmus (Striped Pangasius, Swai) / Pangasius Bocourti (Basa)
Swai:
The
market is mostly steady and quotations remained unchanged. Supplies
of 3-5s and 5-7s are just adequate to meet moderate to active
interest. 7-9s and 9-11s are steady. The undertone is steady to full
steady for smaller sizes and steady for larger ones.
UB |
Chart
based on monthly data
Catfish
Chinese
Catfish Frozen Fillets: The lower end of our quotations
retreated. Discounted offerings continue to be noted for volume
sales. Supplies are ample for a fair demand. The undertone is barely
steady.
UB |
Chart
based on monthly data
Cod
Pacific
cod
•After
three weeks of fishing, the longliners have caught 18,100MT in the
Bering Sea •At this rate, the fishery should close in early
February (closed last year on Feb. 8) •710MT landed by the pot
C-Ps –leaving perhaps one week of fishing in this fishery
•2,300MT landed by the pot catcher vessels –on course to
close in mid-February •560MT landed over the first three weeks
by the <60ft vessels in the Bering Sea •1,000MT caught by the
inshore component in the western GOA
•The
central GOA inshore fishery caught 4,700MT and closed on January 13th
UB |
Chart
based on monthly data
Halibut
•The
IPHC agreed on a March 21 opening date, two weeks later than last
year •Quota is down 9% overall
UB |
Chart
based on monthly data
Pollock
RUSSIAN
POLLOCK QUOTAS RISE AS ALASKA’S FALL
As
expected on Saturday, the North Pacific Fishery Management Council
(the Council) voted to cut pollock quotas in the Bering Sea by 18.5%
to 815,000 metric tons (MT). The Council’s decision was
unanimous and followed the advice of its scientists, who believe the
Bering Sea pollock stock is experiencing a cyclical downtown in
abundance. In other words, they do not believe the reduced abundance
is a result of overfishing or poor management.
The
Secretary of Commerce must approve the Council’s recommendation
before it becomes law, but it is rare for the Secretary to oppose the
Council’s will.
Seen
over a longer time scale, the proposed 2009 quota of 815,000MT
represents a 45% drop since the most recent peak of 1.5 million MT in
2004 and will be the lowest pollock harvest in three decades.
BERING | |
all | |
Year | TAC |
1999 | 992,000 |
2000 | 1,139,000 |
2001 | 1,400,000 |
2002 | 1,485,000 |
2003 | 1,491,760 |
2004 | 1,492,000 |
2005 | 1,478,500 |
2006 | 1,485,000 |
2007 | 1,394,000 |
2008 | 1,000,000 |
2009 | 815,000 |
Avg. | 1,288,387 |
Implications
for frozen seafood buyers:
• Another large cut to Alaskan pollock
quotas will tighten availability of single-frozen pollock fillets,
MSC-branded pollock and other products reliant on the Alaskan
fishery.
• A pollock quota increase in Russia
may provide more raw material to Chinese processors, meaning an
increase in supply of twice-frozen fillets.
• But the supply chain of Russian
pollock processed in China may be complicated by the Russian
government, which aims not only to eliminate smuggled exports (often
to China) of pollock, but to process as much of its own raw material
in Russia.
• Especially for Alaskan products,
supply and demand suggest upward price pressure.
• But prices have risen steadily for
many species in the last three years, in many cases reaching record
levels. The current global economic slowdown has already caused the
floor to collapse from under the prices of many other species, so
tighter pollock supplies in 2009 may not necessarily force up prices
as we would normally expect.
UB |
Chart
based on monthly data
Salmon
Farmed
Salmon: The Northeast wholefish market remains unchanged;
supplies are adequate for a quiet demand. The European wholefish
market continues to hold about steady at listed levels; a few lower
offerings were collected. Demand is fair. European fillets are also
reported to be available; pricing ranges from 4.15 to 4.30 on 3 pound
and up fillets. The Chilean fillet market also remains about steady;
supplies range from adequate to fully adequate for a dull demand. A
few
lower
offerings were noted on all sizes and buying activity is quiet.
Product is reported to be readily available. The Chilean frozen
fillet market adjusted higher on 2-3 pound fillets. The Chilean
Steelhead market is unchanged. The West Coast wholefish market
weakened on all sizes. Supplies are fully adequate to ample for a
lackluster demand. A few still lower offerings were collected.
Keta:
With the harvesting in all areas done for the year, the focus is now
on available inventories of frozen Keta salmon. A large percentage of
the Hokkaido Chum catch has not been sold to Chinese re-processors.
Unstable market conditions in the US and Europe as well as volatile
exchange rates are limiting the Chinese re-processors to purchasing
only for their immediate needs. A gradual decline in Chum pricing is
expected once Chinese factories resume production after Chinese New
Year.
Chum:
The frozen inventories are barely adequate. Look for strong pricing
through the Winter.
Sockeye:
The catch has been strong but not near what was expected. Pricing on
all forms has firmed substantially in the last 30 days with no end in
sight.
UB |
Chart
based on monthly data
Tilapia
The
market firmed on 3-5s. The balance of the market holds a full steady
undertone with a couple of higher offerings
noted.
Overall, supplies are short for an active demand.
UB |
Chart
based on monthly data
Tuna
The
situation is similar to Swordfish. Upcoming peak harvest period and
stronger USD could mean softening market.
UB |
Chart
based on monthly data
Calamari
There
has been no change in the domestic calamari front - landings
continue to be steady, with the squid slightly smaller than we would
like, but not too bad. The weather continues to be a challenge,
though this week it has been ok - today at the dock we have over
50,000#s.
Overseas, China is very quiet as a result of
Chinese new year, so all production there has stopped. India is
between seasons, so there is no real news out of there. In
Peru, there have been some landings, for the first time in almost a
year. To date the sizing has been pretty small, but it appears
that things may be heating up there.
UB |
Chart
based on monthly data
|
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