Inside Round CHC & SEL. Ribeye CHC & SEL. Current Week Up Up Up Up Up Up Up Up. Flat Flat Flat Up Up Up Flat Up

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1 Market Updates: March 2, 2017 Center of the Plate Beef Beef slaughter is below January peaks, but it is running 5 6% above last year. Feedlots are very current and continue to get more money for cattle. So far, higher beef prices have allowed packers to pay up for cattle. Demand for middle meats like sirloin, strips and ribs are definitely benefiting from mild weather and retail features. Rounds, flank and ball tip prices are also shooting higher. Ground beef is well cleared, with prices trending higher. Higher beef prices may begin to slow demand later this month, especially during Lent, but right now most markets are strong. Ground Beef 81% Brisket Inside Round Ribeye Strips Ball Tips Tenders Flank Steak Current Week Up Up Up Up Up Up Up Up Next Week s Projections Flat Flat Flat Up Up Up Flat Up Pork Ham prices have leveled out amid a new round of buying for Easter features. Belly (bacon) prices continue to retreat from last month's lofty peaks, but prices are still well above levels which make sense for features. Butts and loins continue to see good retail and export demand keeping prices in an uptrend. Butts Hams Spareribs Loins Bacon Current Week Up Flat Up Up Down Next Week s Projections Flat Up Up Flat Down Chicken Most chicken items are in good balance, but white meat is more available than it was in the last few weeks. Prices for breast meat and tenders should level off for a while. Export demand for leg quarters continues strong, with prices in a strong uptrend. Thigh meat prices are starting to look cheap in comparison to leg quarters. Wing prices have leveled off with food service operators starting to increase orders in anticipation of basketball "March Madness". Jumbo BNLS/SKNLS Breast Clipped Tenderloins BNLS/SKNLS Thigh Meat Jumbo Wings Medium Wings Current Week Up Flat Flat Down Down Next Week s Projections Flat Flat Up Flat Flat Turkey Prices are mostly flat as buyers begin to step in for frozen inventory programs.

2 UB Hens, East, 12 lb. Frozen UB Toms, East, 22 lb. Frozen UB Turkey Breast, East, 8 10 lb. Current Week Up Up Flat Next Week s Projections Flat Flat Flat Cod Alaskan (1x Fzn) Supply for new season is adequate at a competitive cost. Cod Atlantic (2x Fzn) Market prices continue to increase. Early 2017 fishing are reporting poor landings also. Cod Pacific (2x Fzn) Market prices continue to increase. Higher cost of Atlantic cod are driving substitutions into Pacific cod increasing demand and price. Crab Meat Blue Swimming Crab An overall 3.1% increase in imports was seen in 2016 over 2015 and the blue swimming crab meat market remains firm. This is due to high replacement costs and the tight availability of raw materials overseas. Indonesia remains the top producer with 46.79% of total imports YTD; however, bad weather there and in Southeast Asia has caused a late start and demand is outpacing current production rates in these areas. This shortfall has led to stress for major packer facilities in other countries and will increase raw material costs. Crab Snow Prices remain firm due to the lack of supply on all sizes. New season is around the corner with the expectation of a quota increase out of the gulf on the Canadian. The Alaskan season had their quota reduced by 40 % so availability has been scarce and costs elevated. Euro Lake Fish & Zander Supply is adequate at this time on all sizes and prices have been softening as of late as we move into Lent. These items are a cost savings option when compared to domestic perch and walleye. Gator Stable, good supply, slower than normal movement. Haddock The most competitively priced white fish is getting noticed from buyers. Prices are increasing and forecasted to remain firm medium term. Lobster Brazil Although imports into the country this year were down over last year supply still remains adequate and costs stable. New season resumes in June with new supplies arriving by ship in early July. Lobster North Atlantic Costs have firmed since the lackluster Nova Scotia season this fall for N Atlantic tails. Weather in this region has also restricted any kind of added fishing at this time. Expect these costs to stay elevated until the new season in May. Meat price however (CK, CKL, CK broken etc) are coming off of very high costs and have started to soften on all sizes at this time.

3 Lobster South African Supply is adequate for lackluster demand. Mahi Mahi Mahi Mahi is very tight at the moment with extremely firm costs. The effects of the strongest El Nino since 1997 still have lingering effects on catches and supply out of S America. In addition FDA inspections and refusals have also been at an all time high reducing supply. Expect costs to stay firm through the spring with the possibility of some relief out of Asia at that time. Orange Roughy Stable supply and cost for a average demand. Oysters Supply has been short for new season supply due to limited catches of the desired sizes Look for improvement in landings in March. Perch & Walleye The class of fish is expected to be in the 4/6, 6/8 and 8/10 range for the spring walleye season. For now prices are firm across the larger sized offerings with some relief on the smaller 2/4 and 4/6 oz sizes. Perch is also firm with more availability on the smaller michigan sized fillets. Pollock Atlantic (1x Fzn) Pollock sizes for the start of the A season out of Alaska are predominantly yielding a 2 4 oz fillet. Large sizes in the 4/6 and 6/8 range are still minimal to nonexistent. With first supplies just arriving to the lower 50 states we expect costs to be stable at least til the B season. Salmon Keta The significant reduction in pink salmon landings in 2016 (buyers short of pink salmon utilize certain grades of chum) and lower supplies of Atlantic salmon (certain grades of chum salmon are acceptable for smoked and portion programs) increased the demand for chum salmon in This increased demand, combined with lower than expected landings (16.2 m actual vs 18.7 m forecast) and increased percentages of pale meat color fish have caused the commodity h/g prices to increase. Salmon Pink Alaska Pink salmon landings this year totaled about 40 m fish, less than half the preseason forecast and one of the lowest catches on record. This also is a significant reduction from the 2015 landings of m fish. This reduction in volume, combined with the continued strong demand for value priced wild salmon, were the primary reasons commodity h/g prices increased. Salmon Sockeye Salmon Sockeye are short in the market and prices continue to push up since the full effects of the Atlantic market shortage. Since there are not much fish to buy right now and demand is extremely brisk, prices are jumping dramatically in the past month. The processors or anyone company that professes to possess Sockeye have dramatically increased prices to customers that need fish. The price is split between harvest areas although the difference is getting more even as the shortage and demand situation continues to be out of balance. Bristol Bay Sockeye remain the standard bearer in the market that has risen 30% 35% above the historically low prices of Non Bristol Bay Sockeye, so called Local Sockeye, prices are up 50% from 2015 mainly due to low harvest levels and a brisk fresh market that sold most of the available #1 fish. Only Bristol Bay had a good harvest in 2016.

4 USA (Domestic) demand has risen quickly with many major chain restaurants and large retailers adding Sockeye to the menu or as a special retail item. Interest in Sockeye in the Domestic market is at an all time high which is pushing up the market for premium, wild caught salmon. Expect the market to remain firm as the new forecasts for 2017 come out by region showing reduced harvest estimates. No relief in prices are expected in 2017 as the market seems to be continue to push upward; however, an increase in aquaculture salmon in the 3 rd quarter of 2017 might mitigate prices from moving up to historical highs seen in Salmon Coho The historical low prices for Coho seen in 2014 and 2015 has abated with increased demand, flat to lower landings (depends on the area), and Aquaculture salmon low harvest. The Atlantic die off due to the algae bloom coupled with lower planting levels of Smoltz, has pushed new customers to look for premium wild salmon like Coho. Coho cooks much closer to Atlantics albeit lower oil content and is seen as an adequate substitute. With low to flat landings along with a small harvest fish (3.9 million fish in 2016), prices have sprung up to more historical levels. The market is empty and sellers that profess to have fish pushing prices up above historical levels. Expect this trend to continue until farm salmon prices come down and availability becomes less of an issue. Scallops Supply has been available but very costly. With the increase in quota announced for the spring season we hope this will start to adjust the market to more reasonable levels over the next few years. Sea Bass Costs are firm with a lack of supply currently in country. Asia continues to be a big draw of supply out of Chile increasing the cost of goods to the US and limiting available supply. Expect this dynamic to be the norm for some time. Snapper Supply is good and costs are stable. Squid Loligo The global production of of Loligo squid species continued to be significantly below normal throughout 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 US 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 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 Shrimp Asian Black Tiger Black Tiger shrimp remain firm in price as supply remains limited. Larger shrimp are more readily available in sizes of ct/lb and larger with the majority of countries producing only these sizes in any volume. Prices are expected to remain elevated through the spring. Shrimp Asian White

5 Asian White shrimp are mostly unchanged, with the exception of price increases on smaller shrimp. Most farmers are growing out to mid range sizes and premium prices are developing for smaller shrimp as a result of limited production on Black Tigers and S. American whites in small sizes. Shrimp Domestic Peeled (PUD) Domestic peeled shrimp are firm in price with the exception of 150 and smaller. Shortages are developing on some sizes, while there are discounts made at random where individual company inventories are heavy. Domestic Domestic Rock & Pink Rock shrimp is still very difficult to come by. The small quantities that are caught are priced high, but typically move quickly. Pink shrimp prices have continued to climb as demand has been good, and they are still a great value alternative to the Rock shrimp. Shrimp Domestic White & Brown Headless Domestic White & Brown shrimp continue to be high priced and firm in offers as we progress through the off season. The record low harvest numbers for the year should really start to show in the coming months as pricing is expected to stay elevated. Swai Price is on the upswing. Lack of interest from farmers due to lower prices last year and stricter inspections with import looming this fall is creating supply challenges in larger sizes. Tilapia Supply is consistent with seasonality. Prices are up because of cold weather and the growth of tilapia slows. Tuna Frozen Tuna supplies and costs are stable at the moment. No issues or interruptions are expected. Tuna Canned Skipjack hits a high. Whitefish Costs are stable and supply is currently readily available on all sizes. Dairy Dairy Category Last Week Current Week Block Cheese Down Down Barrel Cheese Down Down Butter Up Up Large Eggs Down No Change Medium Eggs Down No Change Small Eggs Down No Change

6 Cheese The block and barrel markets have continued their downward trend as there is ample cheese for the current demand. Expectations are that the markets will continue its current trend even with the possibility of seeing a quick bounce before moving back down. Eggs Retail demand is fair. Supplies are long and the market is weak. Butter Prices are forecast to remain at or close to the current market price over the next few weeks. Sustained access to ample supplies likely kept warehouses filling inventory through early February. Constant demand could keep prices supported ahead of the Easter holiday as spot prices have risen this week. Grocery & Bakery Flour prices have leveled off and could begin following grain prices back up. Speculation that the Trump administration will increase the quantity of grain used in biofuel has triggered a futures price rally. Wheat Vegoil prices have leveled off and are now moving higher. The market is betting on increased biofuel demand, but world soybean supplies are large. Longer term, the details of any Trump biofuel initiative will need to be compared to increases in soybean supply to know which way vegoil prices will go. High Gluten Flour Semolina Pasta Flour Current Week Flat Flat Next Week s Projections Up Flat Soybean Oil Vegoil prices have leveled off and are now moving higher. The market is betting on increased biofuel demand, but world soybean supplies are large. Longer term, the details of any Trump biofuel initiative will need to be compared to increases in soybean supply to know which way vegoil prices will go. Current Week Next Week s Projections Soybean Oil Flat Up Sugar There is considerable uncertainty surrounding imports of Mexican sugar. There has been no progress in reviewing the quantity of duty free Mexican sugar which may be imported. With the Trump administration suggesting they want to renegotiate the entire NAFTA agreement,, it seems unlikely that Mexican sugar imports will restart anytime soon. As a result, cane sugar prices are firm to higher and beet sugar prices are at least steady. Current Week Sugar Flat

7 Next Week s Projections Flat