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Commodities Report: Farmers Planted Record Number of Acres



The USDA provided some good news for commodity buyers in August with their latest crop projections. As readers will remember, a cold, wet spring delayed corn and soybean planting at historic levels. As of the first week of June, farmers still had 48.3 million acres of corn and soybeans to plant. Before 2019, farmers had never planted more than 20 million after the date. But according to the USDA’s latest survey, farmers planted a record 45 million acres from the second week of June on this year causing overall planted corn acreage to come in well above expectations.  Soybean acres are smaller but there is a much larger margin of risk with that crop. Thus, it appears that feed supplies will tighten for 2019-20 but remain adequate causing fairly attractive feed prices to persist.  Good news for 2020 protein and dairy production for sure.  Still, the USDA is currently forecasting tempered growth in protein supplies for next year. Beef output is forecasted to rise just 1.9 percent with, accompanied with better demand, suggests that there could be upside pressure on prices at times.  Chicken production at 43.3 billion pounds would be up just .9 percent but the growing hatchery flock suggests that output could be larger.  Pork production is forecasted to rise 2.8 percent which is historically solid but significantly less than the estimated output growth of 5 percent for 2019. Pork exports surged during July with most of that going to China. As our readers know, record pork and hog prices are occurring in China due to African Swine Fever, and supplies are expected to remain short there deep into 2020. Thus, we are concerned around the upside price risk in pork prices next year.  We remain less concerned around dairy as the USDA is forecasting milk output growth next year to be the largest since 2016. 


David Maloni is commodity consultant for American Restaurant Association Inc., a food commodity research, forecasting, consulting, and contract risk management organization founded in 1996 specifically advising the US restaurant and hotel industry and supply chain.


BEEF-Prices are by the pound and based on f.o.b. Omaha carlot.
9/5/19 8/8/19 Difference 9/6/18
Ground Beef 81/19 2.28 1.86 0.42 1.97
168 Inside Round (ch.) 2.37 2.11 0.26 2.01
180 0x1 Strp (choice) 7.73 6.08 1.65 5.64
112a Ribeye (choice) 8.60 7.83 0.77 7.77
189a Tender (select) 9.06 8.29 0.73 9.25
189a Tender (choice) 10.53 9.62 0.91 9.26

 

OIL AND RICE-Prices per pound based on USDA Reports.
9/5/19 8/8/19 Difference 9/6/18
Crude Soybean Oil .286 .272 0.014 .284
Crude Corn Oil .274 .272 0.002 .263
Rice, Long Grain .251 .243 0.008 .262

 

DAIRY-Prices are by the pound and based on USDA reports.
Cheese 9/5/19 8/8/19 Difference 9/6/18
American 1.78 1.79 <0.01> 1.71
Cheddar (40#) 1.99 1.91 0.08 1.76
Mozzarella 2.07 1.99 0.08 1.83
Butter(AA)
One pound solids 2.21 2.35 <0.14> 2.21
Class II Cream
Cream 2.85 3.34 <0.49> 2.92

 

PORK-Prices are by the pound and based on f.o.b. Omaha carlot.
9/5/19 8/8/19 Difference 9/6/18
Belly (bacon) 1.13 1.54 <0.41> 0.86
Spare Rib (3.5& down) 1.22 1.24 <0.02> 1.28
Ham (23-27#) 0.60 0.92 <0.32> 0.52
Bbybck Rib (2-1.75#) 2.23 2.28 <0.05> 2.22
Tenderloin (1.25#) 1.85 1.83 0.02 2.05

 

POULTRY-Prices are by the pound except for eggs (dozen) and based on USDA reports.
Chicken 9/5/19 8/8/19 Difference 9/6/18
Wings 1.87 1.87 - 1.45
Bnless Skinless Breast 1.01 1.03 <0.02> 1.01

Eggs
Large 1.14 0.50 0.64 1.11
Medium 0.70 0.38 0.32 0.72

 

Miscellaneous
Whole Turkeys (8-16#) 0.91 0.90 0.01 0.78

 

PRODUCE-Prices are by the case and are based on USDA reports.
8/8/19 8/8/19 Difference 9/6/18
Limes (150 ct.) 42.00 19.00 23.00 19.00
Lemons (200 ct.) 25.47 28.47 <3.00> 47.80
Cantaloupe (18 ct.) 4.50 4.50 - 8.09
Strawberries (12 pts) 11.00 7.50 3.50 10.00|
Avocds (Hass 48ct.) 37.25 51.00 <13.75> 37.58
Idaho Potato (70 ct.) 20.00 19.00 1.00 10.25
Yellow Onions (50 lb.) 5.75 12.67 <6.92> 5.00
Red Onions (25 lb.) 12.18 16.75 <4.57> 15.21
White Onions (50 lb.) 21.93 29.46 <7.53> 25.02
Tomatoes (5X6-25lb.) 17.50 15.95 1.55 13.45
Roma Tomatoes 11.44 13.95 <2.51> 10.95
Green Peppers 9.69 15.18 <5.49> 9.79
Iceberg Lettuce 9.25 8.54 0.71 8.69
Leaf Lettuce 8.36 8.89 <0.53> 8.28
Romaine Lettuce 12.49 11.45 1.04 9.28
Broccoli (14 ct.) 12.11 10.13 1.98 12.93

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

*Covered party (as defined below) shall not be liable for any direct, indirect, incidental, special or consequential damages of any kind whatsoever (including attorney’s fees and lost profits or savings) in any way due to, resulting from, or arising in connection with the Monthly Commodity Report, including its content, regardless of any negligence of the covered party including but not limited to technical inaccuracies and typographical errors.  “Covered Party” means the American Restaurant Association Inc. and the employees of.  © 2019 ArrowStream

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