Market Update From the West Coast Meatheads
August 29, 2016
The market tone for the week opened with a flat feeling, and that is how it closed on Friday. Gains with rib values during the week were largely offset with weaker strip and short loin values.
Retail business remained rather lackluster, as schools in some areas were back in session and spending was diverted to “back to school” necessities. In other areas, vacations were taking precedence over retail spending.
As the trading work winds down, about steady to barely steady remains the tone associated with the spot market. Most offering prices were unchanged overnight.
The few modifications seen in with asking price levels are: outside skirts and select tri-tips moved slightly lower. Ground beef is offered at steady levels.
The weaker trend in the cash hog markets continues since packers are well supplied with hogs through the middle of next week or beyond. Prices have eroded further this week but only modestly compared with earlier in the month and during July. Over the past two weeks, USDA's national weighted average price has fallen only $1.10 per cwt, but since the summer peak hit on June 23, the market has tumbled $19.62, or nearly 25%.
So far the day's efforts at price discovery have served to confirm that much of what was in place at Thursday's close is still there today. Whole body hens are receiving buying interest that finds fewer offerings than anticipated.
Asked prices on available supplies trend higher for ship dates into mid September. Toms are rated as steady and at some points full steady. Here the offerings that are problematic tend to be in the 22-26 pound category where offerings are a bit slow to attract demand at listed levels and the undertone is barely steady. Parts are reported to us this morning at supported values. Whole wings, along with tom necks and tom drums move through domestic channels at no less than full market values at occasionally we've recorded premiums. Frozen hen drums are making the rounds without much response. Border demand for drums has advanced and requires steady to higher values depending on the supplier, freight rates and product form. Generally speaking export demand is very limited with sales into ports largely associated with shipments into the Caribbean. Frozen breast meat is adequate for needs.
The other frozen lines are mixed with age an issue on occasion. Frozen scapula has found steady ground and is well supported. Wing meat and breast trim are challenging sellers.
Fresh tom breast meat is in a fairly good balance with most sales reported steady and a few transactions at up money.
Breast meat offerings are deemed fully adequate to ample at several points of sale. Asked prices are trending lower to stimulate additional interest. Today’s quotations are likely to move lower to reflect this.
Tenders are adequate to fully adequate. Some sources are beginning to report that pressure is surfacing, but paid prices are still within a reasonable range of our listed quotations.
The story remains the same for wings; jumbo especially. Offerings are barely adequate to short and market values are trending higher. Whole birds and WOGs are rated about steady to steady.
In the dark meat complex, whole legs are readily available and values are testing. Leg quarters are mostly steady.