Market Update From the West Coast Meatheads
March 25, 2017
It was again the strong advance of middle meats that outweighed the slight weakness in end cuts that pushed cutouts even higher. The current level is even more bullish than any in the industry predicted for this time.
Last week’s late week strength filtered into this week again. Choice product was up nearly three percent while select surged almost five percent. Boneless ribeyes are the most notable gainer.
The momentum just didn’t stop in the loin complex. Gains this week, from six to eight percent, outpaced even the stellar ones from last week. Strength was once again broad based.
Movement of ground beef was better and prices firmer. Product found support from retailers giving attractive pricing to consumers.
It was a wild week in the boxed beef markets in terms of news but the influence it had on Angus Beef prices was minimal. After we closed the books on last week it looked like the market had a toppy feeling given the hand-to-mouth approach that we started to encounter and the thoughts that slaughters would climb given the record seasonal margins – at a time when they are often negative. It was then announced that many countries would ban Brazilian beef given the scandal that broke.
The former did happen and the latter gave renewed optimism for U.S. packers. So we saw much of the same in the Angus market. Middle meats were the leaders while end cuts were slightly soft.
The market for fresh pork products continued to find support this week, despite lighter than anticipated market activity. Availability of most product lines varied by seller, but collectively was considered barely adequate to adequate.
Buyers continued to bid-up most loin, picnic, cushion, and butt products when needs dictated. Meanwhile, others stood idly by given the lack of pace. Bone-in and boneless center cut loins were marginally improved, while the balance ranged steady/weak.
Picnic and cushion products were once again supported, in-line with the trend on lean sausage materials. Butts also continued to trend higher; supported by a confluence of buying activity, however some weaker action was seen late week.
Rib items remained largely balanced, and traded in a narrow range.
Breast meat is snug at most points of sale, but values are still mostly market related. Tenders are trading at normal levels. Wings are short at most points of sale. Whole breasts and fronts are firm. In the dark meat complex, almost every line has trended higher in value in recent weeks. Whole legs, bone-in thighs, thigh meat and leg meat are firm and wanted. Leg quarters and drumsticks are commanding full market values or slightly better.