January 2021 Market Update

• The packers have had a full week to harvest and that number of hogs is back to pre-holiday levels. That means lots of meat available although processors still face labor issues.
• Bellies & Ribs are the two pork items showing any strength due to high demand and reduced inventory levels in cold storages.
• Loins & Hams supply levels fluctuate as processors struggle with labor.
• Butts are on the weaker side and expect prices to decrease over the next 2-3 weeks although we may hit the bottom soon

• Very active market on both the front and back half of the birds short supply and strong demand.
• Smaller WOG’s and fryers in high demand from fast food chains, i:e KFC, Popeye’s, Church’s, Boston Market and reflected in the increased prices. Larger birds prices are steady.
• Small and medium breast are steady but jumbo boneless are difficult to uncover and we are paying whatever the asking price is.
• All sizes of wings but specifically jumbo continue to be problematic for buyers and sellers as there is not enough product to go around. Expect to pay asking prices or more if product is found. With the football playoffs here and then Super Bowl just ahead, combined with retail and take-out demand, buyers are having to pay up for product. Wing prices have risen $.52 per pound the last half of 2020 compared to $.11 per pound the past five year average.
• The back half of the bird- thighs, legs, drums – took a significant decrease back in August 2020 and prices remained low through the end of the year in the hopes of getting traction. That trend appears to change direction as strong demand from export sales and US processors have tightened up the supply and dark meat is now steady or up. We can expect to see BL SL thighs, BI thighs and Legmeat start to rise in the next few weeks.

• Like pork, the beef packers had their first full week to harvest cattle since Dec 18th and the numbers are back up. We saw prices drop at the end of December after the holiday highs and there now is moderate activity.
• Ribs: prices have tumbled since mid December up to $4 per pound and we may be at or near the bottom. It all depends if the big retailers step in and buy out front for their ads or if they have product left from the holidays.
• Striploins: quite the opposite of ribs. Ribs were high, strips were low, now ribs are low, and strips are rising. Currently we’re seeing moderate increase in prices but that will probably change soon as steak cutters buy product for their future contracts.
• Tenderloins: We did not see the run up in tender prices like we did with ribs so the decrease is moderate although dropping steadily. The future is questionable on tenders with Valentines Day approaching as foodservice is still restricted in many states. In addition, the cruise lines who have a big impact on tenders have yet to resume full bookings and if they do, that market will turn around quickly.
• Top Sirloin: We saw the low point in late December and can expect moderate increases as we head into spring.
• Chucks/ Briskets: After the unprecedent price increase in May/June period, chucks dipped down then up to end the year and in January looks to be steady. Briskets settled down after the May/ June period and is starting to increase moderately.
• Chuck Flats: After hitting a low of $4.62 in July, prices have steadily increased to finish at $5.58 in December. Our January price will be $5.83 due to continued strong demand.

• No major changes in seafood items in general with the exception of crab
  although shipping delays continue to disrupt some imported items.
• King Crab remains tight and short even after the holiday season has passed and prices show no sign of softening. Biggest challenge is finding product.
• Expect Snow Crab prices to be $2.50- $3.00 per pound higher February through March 2021.

Overall, the packers and processing companies are still struggling with labor due to COVID 19. There have been major cutbacks in items offered, increased lead times and shortages are common. Even more of a challenge is the processed items such as bacon, sausages, hams, value added chicken and pork, pizza toppings, etc. As processors juggle retail demand and production capabilities, the shift from foodservice to retail has forced companies to alter their production and the result is impacting the foodservice industry negatively.

This is a snapshot of what is happening in the market today, although conditions can change quickly at any time. Thank you all for understanding the situation as we navigate through shortages, price increases, other disruptions and for working with your customers to offer substitutions.