The USDA’s quarterly Hogs and Pigs report didn’t shed a whole lot of light on a confusing period in the pork industry. All hogs and pigs in the U.S. on June 1st totaled 72.4M head, up just 0.1% from a year ago. The market hog supply was up 0.2%, and the breeding herd down 0.4%. Farrowing intentions were all sharply negative: Mar-May -4.6%; Jun-Aug -5.6%; Sep-Nov -4.5%.
Read MoreOn June 21, the Environmental Protection Agency issued its new mandates for renewable fuel that U.S. refiners must mix with gasoline and diesel for 2023, 2024, and 2025. Although those volume mandates were increased modestly for 2024 and 2025, they fell far short of the expectations of the ethanol, biodiesel, and renewable diesel industries.
Read MoreIn Friday’s monthly cattle report, the USDA said feedlot inventories totaled 11.55M head on June 1, down 2.9% from a year ago. New placements onto feedlots in May were 4.6% above a year ago, and May marketings (from feedlots) were up 1.7%. While U.S. herd liquidation has slowed, imports of feeder cattle from Mexico and Canada are up 31% from last year – and likely account for the increase in placements.
Read MoreWith Father’s Day and Memorial Day behind us, middle meats hit their seasonal highs for the year in early June and should start trending downward as soon as July 4th buying is completed. #180 choice boneless strips at $10.50 per pound are at a seasonal high, up $2.50 per pound from a month ago, but look to be back down to $8.00 by Aug.
Read MoreLast week, the California Dept. of Food and Agriculture (CDFA) Animal Care Program hosted a webinar on Proposition 12. The CDFA’s Dr. Elizabeth Cox cleared the air a bit by saying “…the bottom line is, anything that’s ready to eat out of the package…. does not fall under Prop 12. For example, fully cooked bacon …. does not fall under Prop 12 as a covered product.”
Read MoreFor the past 3 years it’s been a steady drumbeat of Covid, supply chain disruptions, the Ukraine war, and wild swings in consumer demand. Those things sent commodity prices soaring. More recently, while we’ve all been busy complaining about inflation, commodity markets have come undone. Part of that is high prices curing high prices.
Read MoreIn its May 19th monthly cattle report, the USDA said feedlot inventories totaled 11.6M head on May 1, down 3.4% from a year ago. Total new placements onto feedlots in April were 4.2% below a year ago, and April marketings (from feedlots) were down 10.1%. Cattle slaughter for the 4 weeks headed into Memorial Day weekend was close to 4% below 2022 levels.
Read MoreAfter interviewing suppliers, commodity experts, and supply chain professionals of major chain restaurant companies who were in Chicago this weekend – the only real consensus on CA’s Prop 12 (effective July 1), and Mass’ Question 3 (effective June 10), is mass confusion. Both states’ laws restrict the sale of uncooked, whole pork cuts from hogs that do not meet the new gestation crate requirements.
Read MoreFriday’s WASDE report, which contained the USDA’s first estimates for 2024, provided good news, bad news, big assumptions, and a few surprises. Getting the bad news out of the way, the hard red winter wheat crop is in worse shape than previously thought because of drought and freeze damage – and all-wheat ending stocks will drop to 16-year lows.
Read MoreWith cattle herd numbers historically low, and hog farrowing intentions slim, the 2nd half of 2023 is going to be all about chicken – and the poultry industry appears to be geared up to handle it. The USDA reported the current breeding stock of broiler‐type hatching layers was at record high levels on April 1st, 2.3% above a year ago.
Read MoreIn April’s WASDE report, the USDA projected whole turkey prices will average a record-high $1.71/lb for 2023, up from $1.54 in 2022. Those yearly average numbers are a bit misleading, given what has happened so far in 2023. Whole (16-22 lb) tom turkey prices, which peaked at $1.91/lb in Oct 2022, have been steadily declining and averaged $1.65 last week.
Read MoreIn Friday’s monthly cattle report, the USDA said feedlot inventories totaled 11.6M head on April 1, down 4.4% from a year ago. Total new placements onto feedlots in March were down 0.6%, however, placements in the lowest, under-600lb, weight category were up 11.4% vs. a year ago – indicating the drought-induced herd liquidation has not abated.
Read MoreHighly Pathogenic Avian Influenza (HPAI or Avian Flu) has claimed the lives of 58.65M U.S. birds since Jan 2022 - mostly turkeys and egg layers - and that trend is continuing in 2023. Another 58,000 turkeys were infected/destroyed in Pennsylvania in March. Springtime means large numbers of migrating birds in U.S. flyways – and lots of chances for commercial flocks to become infected.
Read MoreFollowing multiple years of drought, the transition from a La Nina to an El Nino weather pattern is expected to bring welcome precipitation to the Midwest corn belt this spring/summer. In its Prospective Plantings report on March 31, the USDA released its first official, survey-based estimates. U.S. farmers said they intend to plant 92.0M acres of corn in 2023, up 4% from last year.
Read MoreLast week’s Hogs & Pigs report should be neutral-to-bearish for near-term hog prices, but more bullish for the 2nd half of the year. The USDA said all hogs and pigs in the U.S. on March 1 totaled 72.86M head, up just 0.2% from a year ago and down 2.1% from 3 months ago. The herd breaks down to 66.7M market hogs and 6.13M kept for breeding – just slightly above a year ago.
Read MoreAt last week’s Market Vision Conference, Brian Williams of Macquarie Bank pointed out that U.S. renewable diesel production capacity will more than double from 2.6B barrels per day (bpd) in 2022 to 5.9B bpd by the end of 2025. Thus, most analysts are very bullish on all veg-oil prices for 2024/2025. But currently, bank failures and recession fears have helped crude oil futures drop roughly $10 per barrel over the past 3 weeks.
Read MoreIn Friday’s monthly cattle report, the USDA said feedlot inventories totaled 11.6M head on March 1, down 4.5% from a year ago. New placements onto feedlots in Feb were down 7.2%. In March’s WASDE, the USDA projected a huge 6.0% drop in beef production for 2023. The USDA raised its forecast 2023 cattle prices from $159.00 to $162.00/cwt, up 12.1% from $144.40 for 2022.
Read MoreFollowing multiple years of drought, the transition from a La Nina to an El Nino weather pattern is expected to bring welcome precipitation to the Midwest corn belt this spring/summer. So far, the USDA hasn’t made any adjustments to its corn balance sheets.
Read MoreWith cattle futures setting new 8-year highs last week at $167.50/cwt on 2/28, and beef supplies looking to be constrained for the foreseeable future, the restaurant industry will need to rely on alternative proteins for some food-cost relief.
Read MoreIn Friday’s monthly cattle report, the USDA said feedlot inventories totaled 11.7M head on Feb 1, down 4.1% from a year ago.
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