Gordon Food Service Market Updates for September 28, 2018

Transcription

1 Gordon Food Service Market Updates for September 28, 2018 Dairy Cheese The block and Barrel market has had some relief recently as supply is above demand. Speculators feel this trading rage will continue in the near future. Last week: Block- Down Barrel-Down This Week: Block- Up Barrel-Down Dairy Eggs Retail demand fair to good. Extra large through mediums well balanced and held confidently. Market steady with an improving undertone.

2 Last week: Large - Up Medium - Up Small - No Change This Week: Large - Up Medium - Up Small - No Change Dairy Butter Butter production is steady and expected to pick up as baking and holidayare in close sight.demand is still solid and inventories are adequate enough to meet short term needs. Pricing is slowly moving north of late summer prices and the expectation is to get a bit higher. Last week: Butter - Up This Week: Butter - Up Grocery & Bakery Wheat Flour prices are below last year as ample domestic supply of high protein wheat more than offsets tighter world supplies. Wheat exports are off to a slow start leaving domestic millers as the main buyer.

3 Grocery & Bakery Soybean Oil Soybean oil prices dipped below the USDA's $0.28-$0.32/lb projected trading range. Prices have since rebounded due to higher bio-diesel demand. Grocery & Bakery Sugar Harvest is about a week ahead in Michigan and mostly on track elsewhere. Based on early harvest results Michigan Sugar believes they have 80% of their 2018/2019 production sold. They announced a price increase effective immediately on the remainder of their output. Meat Beef Beef prices seem to be leveling off after declining since mid-august. Beef output was higher than 2017 for the first time in several weeks, but expanded exports and strong forward sales have kept spot supplies well-cleared. Ground Beef: Ground beef are leveling out as the cost of beef trimmings hits bottom. Ribs: Packers took big discounts to get forward sales of bone-in ribeyes. With bigger forward sales, 25% fewer cases were available for spot sales which has supported prices. Briskets: Brisket prices appear to be leveling out; forward sales are at small discounts to spot. Rounds: Prices are trending higher for flats and eye rounds; steady at seasonally low prices

4 for insides. Strips: Packers are discounting forward sales to reduce the amount of product they have available for spot markets. Cash prices are at 5-year highs for this time of year. Tenders: Discounts on forward sales tenderprice continue keeping spot markets tight and prices high. Thin Meats: Ball tip, flank steak and outside skirt prices are adjusting lower, but remain at the upper end of the price history for late-september. Meat Pork All plant shutdowns due to Hurricane Florence have ended and, with a large Saturday harvest likely, fresh pork output should begin catching up with demand. The 20% price jump which followed plant closures should retrace as we move into the biggest production months of the year. Butts: Butt prices are higher; plant shutdowns and strong exports fueled the increase. Hams: Ham prices were very low when Hurricane Florence cut supply; prices spiked higher. Bacon/Bellies: Belly prices are up 57% since late August. Retail features at "hot" prices and plant closures kicked prices higher. Ribs: Sparerib prices inched higher last week. A large part of demand is for freezer programs this time of year so temporary supply interruptions have less of a price

5 impact. Loins: Boneless loin prices jumped almost 40% after Hurricane Florence cut supply. Retailers scrambled to cover National Pork Month feature requirements. Poultry Chicken Hurricane Florence reduced chicken harvest by 3-4% with closed plants back on stream this week. Other than items with strong seasonal demand most chicken prices were unaffected. Breast and Tenders: Breast meat prices have leveled out; tender prices are inching higher due to temporary supply disruptions and due to seasonal demand for boneless wings. Wings: Jumbo and medium wing prices are edging higher, with tighter supply hitting in the middle of peak football season demand. Small wing prices have stopped going down. Dark Meat: Leg and thigh meat are steady. Poultry Turkey Frozen whole turkey prices are flat as we approach Thanksgiving. Seafood Finfish Cod, Alaskan 1x: Supply remains tight and costs are firm, this is partly due to decreased quota in other regions of the world. Expect this toremain this way through the end of the

6 year. Cod, Atlantic 1x: The 1x frozen Atl. cod loins are firmon costs withthe announcement of a 25% reduction on quota compared to2017 out of the Newfoundland and Labradorregions in Canada. Inventoryhas been ramped up to cover increased demand on all sizes but the smaller sized4 oz has been tight. Expect costs to firm and remain elevated through at least the end of the year. Cod, Atlantic 2x: Fishing in Northern Europe has concluded.total catch this season ispoor and raw material is in short supply for2018 until early 2019 when fishing resumes. Cod, Pacific 2x: Heavy restrictions on total allowable catch in certain Alaskan fishing grounds. Raw material is now more expensive than Atlantic Cod and expected to firm continuously for all of Pollock, Atlantic 1x: Costs have softened slightly on some sizesof the 1x fzpollock but mostremain steady for the balanceof the summer and through the B Pollockseason. Many anticipated with the rising cost of Cod that Pollock would be the next lower cost option.for the most part that "switch" has not materialized to the degree first thought. Pollock, Pacific 2x: Slight firming of pricing. Starting to see substitution demand from cod users. Haddock: Raw material prices firming due to the cheapest ground fish compared to Pacific and Atlantic Cod. Continued substitutions from cod consumers driving up demand and cost.available raw material is in short supply. Domestic Lake Fish: Prices softenedover the summer as supply was plentiful. As we are starting to enter

7 the fall fishing season, costs have ticked up slightly but are expected to level off.larger walleye and 8/10 whitefish have been hard to find at this time due to the class of fish on the lake. We expect this issue to resolve itself come fall. Euro Lake Fish & Zander: Supply is good and costs have been stable with only minoradjustments to market.this is a more cost effective substitute for the higher priced domestic lake fish items where applicable. Mahi Mahi: Mahi Mahi costs and supply are currently steady for an activedemand. Typically the springseasonbrings added containersfromtaiwan and Vietnamto supplement, butinventorydid not materialize this yearout of Asia as expected, with 40% less reported landings over New S America product should begin to arrive in Nov / Dec., price will be determinedat that time but there is some indication of a further cost adjustment downwardfromlast season'scosts. Frozen Tuna, Swordfish : The peak season in Vietnam for tuna ended in July. As landingsdropped offcosts have startedto increase. This hasbeen attributed in part to the newiuu fishing regulations forcing more plants to compete over limited amounts of local raw material. The Indonesianseason is at its end. Combined with soft Vietnamese production, prices remain elevated out of this region as well.thailand has yielded limited supply as most long-line boats are fishing in Sri Lanka now that they are green listed with the EU. Prices have substantially increased on Swordfish from Indonesia, high demand from the European market and stricter regulations are the main cause. Demand remains strong from both retail and foodservice customers Swai: Cost fingerlings increased after Chinese New Year instead when market expected a drop. US trade commission assesses preliminary higher duty rates in Swai. Prices firm with short supply until end of 2018/early Tilapia:

8 Low production during this time of the year. Prices recently firmed. Seafood Shrimp Imported Black Tiger: Black Tiger shrimp prices are stable and supply is good on small and middle sizes. There are shortages of large sizes due to limited production (2-4 through 13-15) and heavy demand. Imported White: White shrimp supply is somewhat sporadic with shipments being late due to heavy demand overseas. Market values are good and offer great opportunities to menu shrimp this summer. Expect supply to be better as we roll into the late summer months as production catches up. Latin White: Latin White shrimp are firm with replacement prices firming. Supply is good for the time being. Domestic White & Brown: Domestic Brown shrimp are steady in price as we roll into the new season for Texas. Larger sizes of white and brown headless shrimp should begin to land over the next few months. Domestic PUD: Domestic PUD production has slowed on smaller shrimp. While boats begin to target larger whites and browns where available, we should see better production in larger and middle size peeled shrimp. Domestic Rock & Pink: Rock & Pink shrimp are both in good supply.

9 Seafood Lobster North Atlantic: Lobster tail costs have been steady to date. Meat prices have been soft.landings inmaine have been marginal so expect costs to increase this fall. There is still uncertainty of how the pending tariffs will affect this market as many reports state the Chinesehave alreadymoved over to the Canadian exports. Until this is resolved or finalized no one can be clear of the impact on the domestic lobster fishermen or their supply. Warm Water: Supply continuesto be hand to mouth on the warm water tails out of Brazil and the Bahamas and costs are firmsmaller sizes namely the 6 oz tailsare harder to come by at the moment. Supply should ramp up soon and be more consistent as we enter the fall. Seafood Crab Snow Crab: The global shortage of snow crab will continue through Prices have leveled off and remain firm on the larger 8 and 10 up products withlimited offerings. The 5/8 size hascontinued to softenas there is more inventoryof this size inthe market, however there is uncertainty of howmuch of this product remains in storage availablefor sale. King Crab: This market has remained unchanged. Smallerking crab sizes remain very tight, especially on 14/17 ct, 16/20 ct and 20/+ ct. Thesethree sizes haveseen the biggest issue with availability and as a result costs are firming.they are still fishing for Russian crab but most is movingthroughtheasian market causing somedelays on containers. We do not expect any relief on supply or cost at least for the next 6-7weeks.

10 Red Swimming Crab: A new 10% tariff on all seafood items should go into effect in August. The market is still uncertain however, between high market prices, and limited supply, cost might go up. This coupled with the void in the market on red swimming crab only strengthens this possibility. We are still expected to start receiving shipments on red crab in October. The main crab harvest is October December. Blue Swimming Crab: Prices are still high with great inventory. There has been a slight decrease in pricing from Indonesia while Philippines and India move up to be more in line with Indo. For the next days prices will stay level to a possible dip however, Q4 is expected to pick back up. With the red swimming still high with limited supply, this too drives the price up. Overall prices will come down a bit. Seafood Scallops With increasedquotathis season and more open areas to fish...costs have decreased for the first time in several years. Supplyhas been more readily availablein the larger sizes. As we enter the fall and the season starts to wrap up, expect costs to start to firm for the winter months.