Stay Ahead of Your Needs

The Dog Days of Summer

BEEF We hit Independence Day next weekend and the start of the “dog days of summer." Once we get clear of the holiday I do expect we will see a market reset, especially on middle meats. I’m not looking for a crash, but I do expect we will see a steady decline over the month of July possibly right into August. There is some data to suggest ground beef is hitting a bit of a ceiling for customer acceptance. I do think we will push past that resistance, but it will be slowly inching higher; if consumer push back is strong enough, we could see grinds settle out where they are. We’ll keep watching but in my opinion we will see moderate increases continue into August. With production last week only 526K head just up from 524K the week prior, inventories will continue to be tight. Stay ahead of your needs. Looking at New World Screw worm, eight new cases, one sheep, one goat, and six head of cattle. Expect the southern border to remain closed to live animal imports through the rest of this year, and most likely well into 2027.  POULTRY Chicken production continues strong, they are not letting up. Demand for boneless skinless random breasts and party wings are moving prices higher next week. Tenders which were out of line with randoms just a few weeks ago have declined to be comparable in costs. Good to keep pushing out that chicken. On the Avian Flu beat, one new case affecting 3K birds.  GRAINS Overall grains are moving lower especially soy oil. Finally breaking lower from the recent highs. I don’t think we will return to the low markets of early this year, but pricing is coming off. Wheat closed at $4.19 down from last week’s $4.30. Wheat closed at $5.84 down from last week’s $6.11. I do expect to see lower grain costs continue as long as we don’t have a major disruption.  PORK Pricing on pork bellies declined again this week, closing today at $116 down from last week’s $118. This is not an expecting market level for early summer. I’ll keep buying bacon at this level, and you should too. Butts are coming off again next week and loins moved up a few pennies but still offer a great value in protein.  DAIRY And a split decision on dairy markets this week, through Thursday’s close, barrel is up 3, while block is down 4 and butter continues lower down 6 for the week. Dairy markets are at good levels for buying now. We’ll keep watching.  Savalfoods.com [https://www.savalfoods.com/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcast] | Find us on Social Media [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig]: Instagram [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig], Facebook [https://www.facebook.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], YouTube [https://www.youtube.com/channel/UCF4jULNg7FD0hEEgMk18Q0g?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], Twitter [https://twitter.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], LinkedIn [https://www.linkedin.com/company/284655/admin/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb]

The Need for Beef

BEEF We’ll start again with the New World screwworm. We now have 6 confirmed cases in Texas and 1 in New Mexico. Affected animals are a dog, a goat and 5 cattle. While our border with Mexico has been closed for months now to live animals, Texas cattle is now barred from export to Canada and I’d expect that list to continue to grow. This is a growing issue that will affect our beef industry for the foreseeable future.  Beef production was 533K head last week, up from the holiday shortened prior week of 448K. This keeps inventories tight and product prices pushing higher. Middle meats, those ribeyes, tenderloins, and strips are finding support to continue moving higher. Chucks and rounds are holding steady for now though they are not big demand items in the summer. Ground beef is the big demand item and it's moving higher every day. Briskets and sirloin flap are moving lower, but I don’t think we’ll see this for long. It’s a market where I’d make sure I stay ahead of my needs and keep inventory on hand. This market is moving higher.   POULTRY The declining chicken market is done. Pricing will be moving higher next week on boneless skinless random breasts, tenders and party wings. Compared to other proteins, still a great value but the declines of the last month are done. Chicken production continues strong up about 2% over last year. There is plenty of chicken in production. On the avian flu report, only three new cases affecting 20K birds. The summer is looking good for avian flu.  GRAINS Corn continues to be a great value closing at $4.25/bushel today, that’s down from $4.39 last week. Soy has pulled back a bit from the highs we saw last week, but I would not be surprised if they go on another run. High fuel prices put soy in play with biofuels, that is not over. Wheat is moving lower; I do think we’ll see lower flour costs soon.  PORK Pork bellies holding steady for the week, closing today at $120, about the same as last week. This will be moving higher soon, but it is a great price right now. Butts were on a tear higher, but they seem to have leveled off, we may see some better pricing shortly. Ribs are about as high as expected to see them this year. Loins continue to be the value in pork.   DAIRY CME Limited moves on the CME this week, thru Thursday’s close, butter is down 2, block is up 1, and barrel is up 2. Let's look for a quiet market at least the next couple weeks.  Savalfoods.com [https://www.savalfoods.com/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcast] | Find us on Social Media [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig]: Instagram [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig], Facebook [https://www.facebook.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], YouTube [https://www.youtube.com/channel/UCF4jULNg7FD0hEEgMk18Q0g?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], Twitter [https://twitter.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], LinkedIn [https://www.linkedin.com/company/284655/admin/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb]

Pressure on the Herd

BEEF Let's start with the bad news. We’ve been expecting this to happen for several months, yesterday the USDA announced the discovery of the New World Screw Worm infecting a calf in La Pryor, Texas, about 50 miles north of the border. This will keep the border closed to live animals for the foreseeable future, keeping pressure on the already small domestic beef herd. The New World Screw worm is a flesh-eating parasite that has been eradicated from the US since the 1970s, but it's back! Control measures include releasing sterile male flies to reduce population growth. This is certainly worth keeping informed about. Now, with that bit of cheery news, let's look at current beef markets. Last week was a holiday week so harvest was only 448K head. Demand remains good, not great. I’m expecting to see market moves higher as we head to Independence Day. Grinds continue to increase every day. Middle meats were struggling to move higher the last couple weeks, but they are back on track with steady moves higher, again I think right into Independence Day. Thin meats, brisket, flanks, sirloin flap, are mostly steady to lower. This continues to be a market with tight supply, make sure to stay ahead of your needs.  POULTRY The decline in boneless skinless breast meat continues next week. The heavy production we’ve seen so far this year is finally catching up a bit on the suppliers. They are discounting breast meat to keep it moving. Tenders are holding steady another week while wings finally bottomed out last week and are moving up, just a bit, but they are moving up again. The avian flu reports over the last week, 7 new cases affecting 107K birds, mostly ducks.  GRAINS Soy was up like a rocket all week, until today. There will be increases in soy oil in the short term, hopefully we can see this turn back down. Wheat is giving back all its recent gains and we should see some lower prices on wheat. Corn closed at $4.39 today down from last week’s $4.62. New crop estimates will not be pushing this market higher anytime soon.   PORK Pork bellies closed today at $120 up from last week’s $112. This is still great pricing for this time of year. I do expect bellies will be moving higher into the summer. One analyst estimated we could see $180 bellies which should be about the top end of this run. Butts continue to be in demand and pushing prices up. Ribs getting the same push higher. Loins are holding steady, don’t see anything to push them higher right now.   DAIRY CME Thru Thursday’s close Butter is up 7, taking back all those recent declines. Both barrel and block are down 1. Production is good, I don’t see much to push cheese higher right now.  Savalfoods.com [https://www.savalfoods.com/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcast] | Find us on Social Media [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig]: Instagram [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig], Facebook [https://www.facebook.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], YouTube [https://www.youtube.com/channel/UCF4jULNg7FD0hEEgMk18Q0g?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], Twitter [https://twitter.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], LinkedIn [https://www.linkedin.com/company/284655/admin/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb]

Stay Ahead of Your Needs

BEEF I’ve been saying for weeks to stay ahead of your needs, and I’m going to reiterate, stay ahead of your needs, as demand does seem to be ticking up a bit. Weekly harvest is not moving up to help meet that demand. Last week’s harvest was 528K head, down from the prior week’s 535K head. While middle meats are struggling to move higher, ground beef is on the march higher every day. Retail ground beef is now averaging over $7/# for the first time…ever. I don’t see this backing off any time soon. Increases in chucks and rounds are very modest but they are moving higher again. Thin meats, briskets, flanks, sirloin flap, are showing some weakness, we could see a correction on this over the next couple of weeks, but it will be pretty minor. Staying with the theme, keep ahead of your needs.  POULTRY Boneless Skinless breasts decline again for next week. Getting to be a pretty big spread between breast meat and tenderloins, tenderloins holding pretty steady. Wings holding steady next week too. Production continues over last year running almost 3% up from over last year. Breast meat is turning into a great value as the price declines. On the Avian flu beat, a really good week, two new cases totaling 11,600 ducks.   GRAINS Corn declined this week, closing today at $4.62 down from last week’s $4.75 close. Wheat was showing signs of a bit of a run, but that is about done, we could see wheat decline over the next couple weeks. Soy was actually showing some weakness, until Tuesday this week, soy is now on the move higher. This could be short lived, but right now, soy oil is moving up.   PORK Pork bellies bottomed out last week at $104. Today’s close $112. Still a great value for this time of year, I’m buying bacon. Summer is typically a high demand time for butts and ribs, and both are moving up steadily. Loins continue to be a great protein value.  DAIRY CME Last week the CME looked like it was going to move overall lower. This week thru Thursdays close, butter is up 3 while block and barrel both declined another 5 cents. We’ll keep watching but I don’t see much to push higher in the short term.  Savalfoods.com [https://www.savalfoods.com/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcast] | Find us on Social Media [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig]: Instagram [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig], Facebook [https://www.facebook.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], YouTube [https://www.youtube.com/channel/UCF4jULNg7FD0hEEgMk18Q0g?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], Twitter [https://twitter.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], LinkedIn [https://www.linkedin.com/company/284655/admin/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb]

Summer Grilling Had Me a Blast

BEEF We are rolling into the summer demand for things that go on the grill. The most common will be burgers, and I do think we will see burgers to continue higher every week, probably all the way to Independence Day. Production numbers continue in the same volume we’ve seen for months now. 535K head harvested last week, 527K the week prior. I really don’t see that improving anytime soon. We are seeing Middle meats, those ribeyes, tenderloins and strips moving up again after a few weeks' breather.  Grinds still heading higher. Chucks and rounds holding pretty steady, but they could be moving higher if demand for ground beef gets those cuts added to the grinder. We should see some relief on thin meats, briskets and sirloin flap in particular are moving lower and that should continue at least a few weeks. It's an interesting market, I’d still stay ahead of my needs, but there could be some deals to be had.   POULTRY Chicken production continues to outpace last year by almost 3%. Demand is meeting supply but there is plenty of product available. Randoms and wings are actually down for next week, tenders holding steady. I do think this market will turn higher as we get into the heat of summer, but I don’t expect any big spikes like we’ve seen in years past. Looks like chicken is positioned to be on the grill this summer. On the avian flu front, another six new cases affecting 57K birds. No fun losing any birds but this is looking pretty good as the weather heats up.   GRAINS Took a week to figure out we don’t have a big grain rally after all. Demand for soy continues strong but doubts about deals with China are pushing all the grain markets lower. Corn almost hit $5 last week, today back to $4.75/bushel.  Soy has leveled off, I would not be surprised to see some decline, not much, but some over the next couple weeks. Wheat is shaping up to have a less than great domestic crop, flour is up a bit and of the three grains we watch, wheat has me watching.   PORK I absolutely did not have bellies for $104 at Memorial Day in my market expectations. I thought last week at $121 was something. I don’t know how long this low market will last but it is not something we would usually see this time of year. It's time to buy bacon! Contrary to that, butts and ribs continue to show strength and up a few cents next week. Loins continue to be steady and a great protein value.   DAIRY CME I didn’t see the belly market crash, and I don’t know if this week is a trend or an event, we’ll see what next week brings. Through Thursday’s CME close butter is down 6, block is down 6, and barrel also down 6. Let's see where this goes next.  Savalfoods.com [https://www.savalfoods.com/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcast] | Find us on Social Media [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig]: Instagram [https://www.instagram.com/savalfoods/?hl=en&utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastig], Facebook [https://www.facebook.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], YouTube [https://www.youtube.com/channel/UCF4jULNg7FD0hEEgMk18Q0g?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], Twitter [https://twitter.com/SavalFoods?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb], LinkedIn [https://www.linkedin.com/company/284655/admin/?utm_source=podsav&utm_medium=players&utm_campaign=mtttracy&utm_id=podcastfb]