Beef, Poultry & Pork Market Update

5/30/24

Highlights

Beef:

The CME June live cattle futures and all futures contracts were higher by 2-3% last week with June live cattle climbing to $179.78/cwt. The choice cutout was up nearly 5% and the select up almost 4% last week. Breaking out the choice cutout, clods were up 3% and chuck rolls were higher by 10% last week. In the round segment, insides were higher by 7%, and flats were up 2.5%. The rib complex also showed life as the boneless ribeye was up 9% to $10.15/lb, and the bone-in exports were up 5.8% last week. In the loin complex, shortloins traded higher by another 6.5% to $8.71/lb. Boneless strips were higher by 2.7% and traded above the $10.00/lb price we projected in January. Also the top sirloin was traded above the $5.00/lb and was up 6.8% last week. Even the tenderloin traded up 6% to $14.00/lb. Ground beef, as we noted in the last weekly update, was higher by almost 12% last week and broke above the $3.00/lb mark where it was pre-sold a few weeks ago. On the stronger performance of the grind market, both 50% and 90% lean trim were also higher. Looking ahead, this week retail advertisements will surge. The promotions will include rib and loin cuts along with ground beef. This will support the higher market. But will still need to measure the demand this holiday season as it will determine the outlook for cattle and beef prices in June.

Poultry:

USDA young chicken harvest was up 1.5% vs. the prior week at 166.2 million head but was down slightly by 0.2% from the prior year when the harvest was 166.5 million head. The National Composite whole birds and WOGs were steady last week. WOGs averaged $1.33/lb. Looking at the parts, most remained firm with gains noted in the tenderloin, breasts, and thigh meat segments. Within the white meat segment, B/S breasts were up 2.7% w/w at $1.81/lb, and chicken tenderloins were higher by 3.7% w/w to $2.21/lb. Wings were down slightly last week to $2.25/lb, and drumsticks were flat w/w at $.43/lb. Thigh meat surged higher last week with B/I thighs up almost 5% to $.95/lb, and boneless thigh meat moved up just over 4% to $1.71/lb and is now up 26% y/y. Looking ahead, beef will dominate the majority of retail advertising space next week for Memorial Day. However, chicken will maintain its presence as a staple in the retail sector, consistent with the trend observed over the past few months, particularly evident in the increased popularity of breasts, tenderloins, and thigh meat.

Pork:

The lean hog futures were all higher last week anywhere from 0.5 to 1%. The CME June lean hogs are the nearest contract on the board, and they finished up to $98.37/cwt or 0.7% last week. Spot/cash hogs were higher at $91.28/cwt for the week. Breaking out the primals and subprimals, the loin primal was flat at $101.60/cwt with the subprimal baby back ribs down $0.08/lb w/w to $2.57/lb. The rib primal was higher by 3.7% last week to $175.70/cwt, and the medium spareribs closed up another $.02/lb to $1.90/lb, which is higher by 26% this year. The belly primal was higher all week and finished up almost 6% to $123.56/cwt as the derind 13/17 belly traded above the $1.51/lb price range. The ham primal was up 3% w/w, but the picnic and pork trim were mixed. The picnic was down almost 2%. In the trim complex, 72% was up almost 6% to $.99.5/lb and the 42% sank almost 2% to $.57/lb last week. Looking ahead, lean hogs are a lot higher in June compared to the current cash market. Overall pork demand looks firm to higher the next few months. The cutout should rise in the next few weeks on the strength in grocery store promotions and increased demand from the foodservice sector.

Bacon:

THE BELLY MARKET CONTINUED MIXED WITH ASYMETRICAL TRADING FOR THE HOLIDAY SHORTEN WEEK THIS WEEK:

For this Memorial Day holiday shortened pricing week, the markets found continued volatility with asymmetrical trading in the complex… as the USDA PRIMAL found general weakness from near 130 down to ~125, while the USDA 9/13 DERIND found moderate upward risk / strength up from near 160 to ~170 for this week. Overall, the market appears to be firming, and will begin to add mild weekly gains now through June… increasing in strength / upward risk heading into and through July. Look for markets to peak by mid-August, although current projections call for this years peak to fall short of last year’s HIGHs. The markets this week averaged near 125 (USDA PRIMAL) / 170 (USDA 9/13 DERIND) for the pricing week, mixed overall from last week’s averages near 130 (USDA PRIMAL) / 160 (USDA 9/13 DERIND). The updated summer outlook appears to be settling / projecting the seasonal HIGH near 200 (USDA PRIMAL) / 250 (USDA 9/13 DERIND) – with the risk that values may not push markets as high as previously believed.

Chicken

B/I Breasts, B/S Breasts, BI Thighs, Boneless Thigh, Leg ¼’s, Whole Wings, Drumsticks, and Tenders up. WOGS down.

Pork

Butts, Loins, Spareribs, Tenderloins, Bellies Hams, Lean trim and up. Cushion, Picnic, Back Ribs, and Fat trim down.

Beef subprimals USDA Choice for delivery week of 6/3/24

Loins

Striploins, Tenderloins and Top Sirloins up.

Chucks & Rounds

Top Rounds down. Bottom Round Flats, Shoulder Clod Heart, Chuck Roll and Shoulder Tenders up.

Thin Meats

Outside Skirt, Flank, Flap Meat and Ball Tips up. Briskets, and down. Tri Tips mixed.

Ribs

Up.

Ground Beef

Up.