Beef, Poultry & Pork Market Update

Beef:

The CME December cattle contract, now the nearest on the board, saw a significant increase of almost 3 percent week-over-week, reaching $192.85/cwt. Spot/cash cattle prices also rose to $191.00/cwt. Steer carcass weights remained steady at 1,428 lbs, which is still 30 lbs heavier than last year. The weekly harvest was 614K, down 3.8 percent compared to the previous year, with beef production totaling 531.5 million pounds.

The choice cutout finished higher by 2 percent at $315.24/cwt, while select increased by 1 percent to $280.48/cwt. The choice primals and subprimals showed mixed results last week. The loin subprimals were weak, but the rib and round complex were stronger. Specifically, the bone-in export rib rose by 3 percent to $13.63/lb, and the boneless ribeye increased by 6 percent to $15.44/lb. Despite trading near record highs, a near-term price correction is anticipated for the rib segment, with bone-in export ribs being sold in the mid-$9.00/lb range.

The loin complex experienced a decline, with choice striploins down 6 percent to $7.14/lb and shortloins lower by 2 percent to $7.23/lb. Choice tenderloins saw a slight increase of 1 percent, closing at $16.91/lb, while top sirloins dropped by 4 percent to $3.85/lb. The end cuts, including chucks and rounds, were mixed to slightly higher. In the chuck segment, both chuck rolls and clods remained flat week-over-week. In the round complex, inside rounds rose by 4 percent to $3.15/lb, and bottom round flats increased by 9 percent to $3.21/lb.

Ground beef 81% saw a 3 percent increase to $2.36/lb. In the trim segment, the price of 50% trim rose by 8 percent to $0.87/lb, while 90% lean trim decreased by 2 percent to $3.20/lb.

Looking ahead, the rib complex is expected to decline now that most holiday purchases have been made. Demand for end cuts and ground beef is anticipated to rise, with striploins poised to be the next steak item to experience price appreciation in the coming weeks.

Minimal market-moving activity was observed within the boxed beef market today. Sentiment and outlooks generally remained steady as we approach the end of the year. A two-tiered market has developed for ribs and tenderloins, with trading windows extending into the New Year. This has led to significant widening in trading ranges, with premiums and rising offers for trade stamped before January and sizeable discounts for post-New Year trade.

The loin arena was relatively muted, with participants generally in agreement when stamping trade for these cuts, resulting in a steady tone. Hand-to-mouth purchasing was the norm within the chuck and round arenas. Sellers were slightly more bullish, which put buyers on their back foot as outlooks between the two parties clashed. Both categories saw tones push towards steady, as roasting items slowly make their way back to the forefront for retailers.

Thin meats continued to see irregular inventories among market participants, pushing the tone towards barely steady. Coarse grinds, while seeing no price adjustments, slowly saw optimism surface among sellers as colder weather begins to take root for a large majority of the country.

Poultry:

The USDA reported a young chicken harvest of 127.7 million head last week. Year-over-year comparisons are not possible due to the timing of Thanksgiving last year. The individual bird harvest weight increased to 6.59 lbs per bird week-over-week, up from 6.49 lbs last year. With the average bird size marginally larger, the overall weekly production of chicken reached 639.6 million pounds. Retail chicken promotions surged by 29 percent last week, reclaiming feature space previously given to turkeys for the Thanksgiving holiday.

Breaking down the segment, the National Composite whole birds and WOGs were up $0.01 week-over-week to $1.29/lb. Foodservice WOGs, particularly the heavily purchased 2.5# to 3.5# WOGs, increased by $0.03 to $1.30/lb. The 2.5dn WOGs were higher by $0.01 at $1.36/lb, while the 3.5# WOGs surged by $0.16 to $1.18/lb. In the white meat segment, boneless/skinless breasts rose by $0.01 to $1.48/lb, and tenderloins remained flat at $1.67/lb. It has been a strong year for the white meat segment, with breasts up 52 percent and tenderloins higher by 39 percent year-to-date. Chicken wings were flat at $1.89/lb, but drumsticks increased by 8 percent to $0.53/lb. Boneless/skinless thigh meat dropped by 1 percent to $1.55/lb, while bone-in thighs remained flat at $0.94/lb.

The USDA’s large eggshell index fell by 5 percent week-over-week but is still up over 92 percent year-over-year. The recently released WASDE report indicates that the broiler price is unchanged for 2025, while the turkey price is raised into the first half of 2025. Egg price forecasts are also raised for 2025 due to lower production and smaller inventory forecasts. Looking ahead, chicken features are expected to remain muted. However, as we move into the next year, an increase in chicken promotions is anticipated as consumers prioritize cost-effective protein choices.

Overall, there have been very few changes to the chicken market recently. Pricing for most lines has remained stable despite the time of year. The WOG markets are well supported by tight supplies and the anticipation of down days next week for many processors. The availability of 3-3.5 lbs. WOGs is especially limited, with sellers obtaining higher prices for production. Some buyers are also willing to purchase the 3.5-4 lbs. offerings, influencing prices upwards for that category as well.

Limited supplies of breasts and front halves are balanced by somewhat quiet demand. Most market participants agree that all sizes of boneless breast meat are more readily available than before. Trade of jumbo and medium sizes is mostly steady, though some processors have shown flexibility in pricing, especially for production in combo bins. Limited sales of select offerings have been inked below the market, but quotations remain unchanged pending additional feedback. Tenders entering the spot market are readily absorbed at supportive prices. Chunk meat and trim meat continue to be readily available, but discounted volumes have been slower to surface.

The call for wings and supplies varies based on the seller. Some processors are short of needs due to heightened demand from retailers for the playoffs and the Super Bowl, while others face issues placing production. Recent detections of HPAI in broiler flocks have resulted in more bone-in back half items staying domestic. The pull from export channels for production has quieted, but most processors still find homes for production around listed quotations. Sellers of leg quarters are even testing higher prices. Thigh meat remains readily available, with sellers willing to let production go at sharply lower values. Despite this, prices are still relatively elevated for this time of year, and some processors report a shift in demand patterns with retailers starting to pull supplies more actively. Leg meat is less abundant on the spot market compared to thigh meat, and the market remains stable. The call for MSC has tapered seasonally, with more offerings available.

Pork:

CME hog futures and cash lean hogs were mixed last week. The CME December future, now the nearest contract on the board, finished up 1.3 percent to $83.55/cwt, while most other contracts were down about 2 percent. Spot/cash hogs decreased by 1 percent to $83.32/cwt. The hog harvest was 2.6 million head, down 2.4 percent year-over-year, with overall pork production at 560 million pounds.

The pork cutout traded higher by 4 percent to $92.31/cwt, with increases in the ham, loin, and butt primals. The loin primal was up 3 percent week-over-week, with boneless pork loin prices rising by 2 percent to $1.33/lb. Loin/baby back ribs increased by 1 percent to $2.27/lb, and tenderloin prices surged by 6 percent to $1.64/lb. The pork butt primal was up 3 percent, with bone-in pork butt prices increasing by $0.01 to $1.22/lb and boneless pork butt prices rising by $0.05 to $1.36/lb. The rib primal was down 4 percent, with medium spareribs trading lower by 8 percent or $0.12 to $1.49/lb. The ham primal surged by 11 percent to $102.14/cwt. The belly primal, which had a rough month, found some support at lower levels, down just 1 percent to $101.22/cwt. The subprimal derind 13/17 belly decreased to $1.25/lb. Pork picnics were higher by 2 percent to $78.49/cwt. The trim segment was mixed, with 42% trim down 5 percent to $0.42/lb, but 72% trim higher by 7 percent to $0.95/lb.

Looking ahead, the pork complex is expected to remain flat as markets focus on holiday beef items. Some primals may be supported by freezer re-stocking, but most of the market is expected to trade sideways for the next few weeks.

According to Expana’s Newswire, the Midwest direct hog markets are expected to be mostly steady. The back-to-back holiday weeks could keep the cash market closer heading into the new year, said livestock dealers and market managers. Widespread PRRS outbreaks may constrain hog supply starting in spring 2025, which is considered supportive of cash prices in the long term.

National Daily Direct Hogs ranged from $72.00 to $80.00, with a weighted average of $79.37 and a 5-day rolling average of $80.97. The live price was not reported due to confidentiality. Hog slaughter projection is 488,000 head.

In the green meat complex, bone-in hams are rated as fully steady, supported by buying activity from Mexico. This is driven partly by threats of new tariffs in 2025, a weaker Peso year-over-year, and elevated hog prices in Mexico. However, some concerns linger over a potentially toppy market, as prices are reaching all-time highs for December, which is atypical for this time of year. Boneless hams are mostly steady to higher, largely due to increased input material costs and reports of limited deboning from some processors. The belly segment has an unsettled undertone, with trade occurring within wide price ranges. Some industry contributors lean toward a supportive outlook in the short term, as bacon sales typically peak during Christmas.

In the trim sector, 42s and 15s are described as barely steady, while 72s are generally sideways, though availability remains tight. In the fresh pork complex, bone-in loins are steady, while boneless loins are mixed, with supply and demand dynamics varying by cutting styles. In the butt category, both bone-in and boneless material show a supportive bias, driven by active interest in roast material domestically and internationally as the holiday season approaches. The rib market, including spareribs, back ribs, and St. Louis ribs, remained unchanged.

Bacon:

THE BELLY MARKETS EXPERIENCE CONTINUED GENERAL WEAKNESS – WITH INCREASING VOLATILITY ACROSS THE COMPLEX THIS WEEK:

The belly complex again performed mostly on forecast this week, with the USDA PRIMAL finding support around the 110 level – while the USDA 9/13 DERIND experienced returning volatility amid varying trade volume across the 5-day pricing week… but generally experiencing downward pressure this week as expected. The USDA PRIMAL may be near the bottom, but there is still room for the USDA 9/13 DERIND to find additional weakness over the coming weeks. This week, the market averages performed slightly below 110 (USDA PRIMAL) / above 140 (USDA 9/13 DERIND) – DOWN from last week’s averages of 110 (USDA PRIMAL) / 155 (USDA 9/13 DERIND). The markets are expected to find mild weakness and downward risk for another couple of weeks, with the bottom of the market is now anticipated to come in near 105 (USDA PRIMAL) / 130 (USDA 9/13 DERIND). Updated forecast show potential returning upward risk for late December, as cold storage / freezer buyers are active in the market and appear to be willing to clear / support belly values north of 100 (USDA PRIMAL) and could add demand vs available supply that could shift trends toward upward risk sooner than previously called.