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Commodities Report: Grains on Defense, Proteins Gain Traction



The commodity markets have been mixed during the last month with grains on the defensive and proteins finding support. The USDA recently published their first farmer surveyed acreage estimates for the domestic 2019-20 crops. Corn plantings are projected at 92.8 million, up 4.1 percent from the previous crop and the biggest in three years.  Conversely soybean acreage is pegged at 84.6 million, down 5.1 percent and the smallest in three years.  And then there’s wheat with plantings at 45.8 million, lower by 4.3 percent and the smallest since at least 1919.  Despite this, the wheat markets are trading near one-year lows. Soil moisture conditions for winter wheat and for the spring planting season are very favorable. So much so that it could delay planting. But history suggests this could lead to historically solid crop yields. Thus, the expectation is for relatively attractive feed prices to persist which should fuel good protein production expansion. Chicken buyers will be happy to know that producer margins have improved considerably in 2019.  And there are signs that year over year chicken output growth will expand in the coming months. This has us thinking that the chicken markets could make early tops this year. Trade negotiations between the U.S. and China continued during the early spring which kept the agricultural commodity markets on edge. And although its likely just a matter of time before the countries resume trade in a more normalized fashion, other trade deals still need to be had including with Japan and the European Union.  Further, the new agreement with Mexico and Canada needs to be approved by Congress which may not occur until this summer. We continue to contend that a deal with China could impact the commodity markets the most in the near term. And it may not be on the usual trade suspects like soybeans.  China continues to struggle with African Swine Fever with estimates as much as 20 percent of their herd effected. Assuming China’s tariffs on U.S. pork are reduced in the not-so-distant future, U.S. pork exports could pick up considerably.  

 

BEEF-Prices are by the pound and based on f.o.b. Omaha carlot.
4/4/19 3/7/19 Difference 4/5/18
Ground Beef 81/19 1.96 1.86 0.10 1.86
180 0x1 Strp (choice) 6.96 6.30 0.66 6.65
112a Ribeye (choice) 8.06 7.86 0.20 7.99
189a Tender (select) 9.32 10.29 <0.97> 9.35
Veal Rack (Hotel 7 rib) 8.88 8.88 - 7.70

 

OIL AND RICE-Prices per pound based on USDA Reports.
4/4/19 3/7/19 Difference 4/5/18
Crude Soybean Oil .283 .293 <0.01> .307
Crude Corn Oil .285 .257 0.028 .280
Rice, Long Grain .240 .241 <0.001> .258

 

DAIRY-Prices are by the pound and based on USDA reports.
Cheese 4/4/19 3/7/19 Difference 4/5/18
American 1.68 1.50 018 1.57
Cheddar (40#) 1.77 1.69 0.08 1.63
Mozzarella 1.85 1.77 0.08 1.70
Butter(AA)
One pound solids 2.25 2.30 <0.05> 2.24
Class II Cream
Cream 2.77 2.58 0.19 2.64

 

PORK-Prices are by the pound and based on f.o.b. Omaha carlot.
4/4/19 3/7/19 Difference 4/5/18
Belly (bacon) 1.46 1.09 0.35 1.07
Spare Rib (3.5& down) 1.42 1.33 0.09 1.48
Ham (23-27#) 0.65 0.47 0.18 0.55
Bbybck Rib (2-1.75#) 2.32 2.22 0.10 2.20
Tenderloin (1.25#) 1.85 1.78 0.07 2.02

 

POULTRY-Prices are by the pound except for eggs (dozen) and based on USDA reports.
Chicken 4/4/19 3/7/19 Difference 4/5/18
Wings 2.00 1.74 0.26 1.53
Bnless Skinless Breast 1.30 1.04 0.26 1.44
Eggs
Large 0.92 0.99 <0.07> 2.77
Medium 0.68 0.79 <0.11> 1.61
Miscellaneous
Whole Turkeys (8-16#) 0.83 0.83 - 0.80

 

PRODUCE-Prices are by the case and are based on USDA reports.
4/4/19 3/7/19 Difference 4/5/18
Limes (150 ct.) 29.00 26.00 3.00 48.00
Lemons (200 ct.) 25.97 23.47 2.50 27.79
Cantaloupe (18 ct.) 13.23 12.45 0.78 10.45
Strawberries (12 pts) 11.00 13.30 <2.30> 14.00
Avocds (Hass 48ct.) 58.25 24.75 33.50 39.50
Idaho Potato (70 ct.) 14.25 13.63 0.62 11.88
Yellow Onions (50 lb.) 12.83 10.06 2.77 6.25
Red Onions (25 lb.) 17.62 12.12 5.50 11.73
White Onions (50 lb.) 60.53 40.81 19.72 17.94
Tomatoes (5X6-25lb.) 13.20 13.20 - 6.95
Roma Tomatoes 9.69 12.73 <3.04> 8.13
Green Peppers 20.75 19.75 1.00 12.03
Iceberg Lettuce 9.49 29.90 <20.41> 7.40
Leaf Lettuce 8.18 18.53 <10.35> 10.85
Romaine Lettuce 9.40 18.14 <8.74> 14.88
Broccoli (14 ct.) 10.97 15.38 <4.41> 7.27


Market information provided by David Maloni of ArrowStream.  ArrowStream is a foodservice supply chain technology company that helps clients capitalize on data to improve their business.  Learn more at ArrowStream.com

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