Week Ending May 29, 2020

**Graphs represent data for the week ending May 22, 2020**

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DIESEL

BEEF Market is unsettled. Total beef production for last week was up 11.4% versus prior week but down 12% compared to same time last year. Total headcount for last week was 555,000 as compared to 647,000 for the same week last year. Live weights for last week were up 4 lbs. from prior week and were up 53 lbs. versus same time last year. Multiple plants have been impacted with closures and reduced schedules over the past several days. Labor availability related to COVID-19 has been an ongoing concern. Production has slowly been improving as we moved into this week but still well short of current needs and same time last year. Overall inventories are limited, and shorts and allocations are to be expected. Prices are seeing large gaps between the packers based on available inventories. Retail demand remains strong with many locations continuing to have issues keeping shelves stocked. Demand for grilling activities is expected to keep additional pressure on the market. Foodservice demand is expected to continue to improve over the coming days

as multiple states ease dining restrictions. Product is expected to be limited as we move into June. Shorts and allocations are expected to be commonplace. Grinds- Market is unsettled. Improving production is helping product to become more available. Price points are still at high levels but have eased from the extreme highs from just a few weeks ago. Loins- Market is firm. Limited production and improving demand are putting pressure on the market. Rounds- Market is unsettled. This week has seen production numbers improving and the market becoming more unsettled on pricing as packers look to get their inventories in line with demand.

U GRINDS ▲LOINS U ROUNDS U CHUCKS U RIBS

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Chucks- Market is unsettled. Improving production is helping overall inventories but they still remain below expectations. The strong demand for grinding material is keeping additional pressure on the market. Ribs- Market is unsettled. Inventories vary between packers causing large gaps in asking prices. Demand has been improving.

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PORK Market is unsettled. Production has slowly been improving over the past few weeks but is still well below same time last year and still short of covering needs. Total headcount for last week was 2,130,000 as compared to 2,310,000 for the same week last year. Labor availability related to COVID-19 has been an ongoing concern and causing many of the plants to have to run at reduced speeds. The limited production is causing cuts and allocations to be commonplace. Retail demand is strong and foodservice demand has been slowly improving as additional states ease restrictions on their shelter in place orders. Pricing has moved dramatically higher and lower over the past few weeks due to the large swings in demand and production.

Bellies- Market is unsettled. After the market surged higher the past few weeks, it has once again seen large drops downward as additional production comes back online. Hams- Market is unsettled. The ham market has seen several ups and downs over the past few weeks as the limited production combined with changes in buying patterns caused the market to become more unsettled. Loins- Market is firm. Inventories are limited. Demand has been good with retail seeing a large push over the past few weeks. Inventories vary between packers with varied pricing and limited availability. Butts- Market is unsettled. Seasonal buying activity has been improving and combined with the limited production over the past several weeks helped to push the market much higher. Improving production is helping to move the market lower but is still well above same time last year. Ribs- Market is unsettled. Seasonal buying demand has been very good and putting pressure on limited inventories. Improving production has the market in a more unsettled tone.

U BELLIES U HAMS ▲LOINS U BUTTS U RIBS

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CHICKEN Market is steady. Total headcount for last week was 162,218,000 as compared to 171,691,000 for the same week last year. Average weights for last week were 6.42 lbs. as compared to 6.22 lbs. for the same week last year. In regard to chick placements, fryers for week ending 6/27/20 are estimated at 151.2 million. This compares to 150.4 million the previous week and 168.2 million the same week last year. Domestic demand is showing increased activity for tenders and wings while boneless breast is starting to slow a bit. The demand for leg quarters has improved over the month of May as retail sales and export activity have shown improvement. Industry supply remains tight, but sufficient to cover demand needs.

WOGS- Market is steady. Demand for WOGs and 8pc cut ups has dropped slightly now that Mother’s Day and Memorial Day have come and gone. Supply is now being reported on most sizes. Tenders- Market is steady to firmer. Foodservice demand continues to show improvement on a weekly basis. As more and more foodservice operations reopen, tender volume is on the rise. With tightened supply, offerings for spot buys are minimal and product availability remains tight. Boneless Breast- Market is steady to weaker. Retail volume is starting to decrease slightly as consumers have stocked their freezers and weekly sales are starting to flat line. Foodservice activity continues to show increased movement. As a total category, demand for small boneless is steady while the larger sizes are showing some weakness. Supply is available.

-- WOGS -▲TENDERS -▼BNLS BREAST

-- LEG QTR ▲WINGS

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Leg Quarters and Thighs- Market is steady. Retail demand remains strong as leg quarters are a cost-efficient product in the meat case. Export demand has improved over the last month as overall protein supply has tightened on a global basis. Freezer inventories continue to go down as weekly slaughter has been reduced. Supply can be available or tight depending on the plant. Wings- Market is firmer. Demand continues to rise as the economy reopens and foodservice volume improves. All sizes of wings continue to sell well, and spot availability is reported as limited.

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TURKEY Market is steady. Total headcount for last week was 3,464,000 as compared to 4,117,000 for the same week last year. Average weights for last week were 32.63 lbs. as compared to 32.76 lbs. for the same week last year. Domestic demand remains strong and driven by retail deli, further processed sliced meats, and whole birds. Export demand for parts remain strong enough to keep the market supported and supply turned. Supply remains limited on whole birds and available on most other categories.

Whole Birds- Market is steady to firmer. Whole birds remain in a firm position as suppliers are producing pre-booked loads for the holidays. Supply continues to be limited based on eggs sets and availability of frozen inventory. Spot loads are limited. Breast Meat- Market is steady. Demand from retail deli and further processors continue to keep the supply of fresh boneless in a sold-up position. Foodservice is now providing additional lift as sandwich-based operations begin to reopen. Supply for fresh breast meat is tight while frozen breast meat is reported as available. Wings- Market is steady. Demand for two joint wings and whole wings remain active both domestically and abroad. Supply is available. Drums- Market is steady. Retail ground turkey continues to be the key driver in this category. With retailers using ground turkey as a sub for the shortage of beef grinds, this category remains in tight supply. Supply is available but limited.

SEAFOOD Gulf Shrimp- Market is unsettled. Even though inventories are seasonally lighter, suppliers are trying to move out last year’s inventories as new season product becomes available. Commercial shrimping in Texas waters is now closed until July.

Black Tiger Shrimp- Market is mixed. Buying demand for larger sized Black Tiger Shrimp is very light and this is keeping downward pressure on the market for those sizes. Mid and smaller sized product have seen improved buying interest and the market is seeing upward pressure. White Shrimp- Market is firmer. Buying activity is improving and putting upward pressure on the market. Replacement inventories from overseas are getting more difficult to acquire as production has been lower than expected. Super Cyclone Amphan struck Asia last week causing additional issues in the region.

-▲WHOLE BIRDS ▲BREAST MEAT

-- WINGS -- DRUMS

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King Crab- Market is steady to firmer. Buying activity has been picking up over the past week and helping keep the market unsettled after having seen demand have very little activity for several weeks. Snow Crab- Market is firmer. Demand has become active over the past several days with demand at retail being very good. Warm Water Lobster Tails- Market is weaker. Demand has been well below expectations for several weeks helping to keep pressure on the market. New season begins in Brazil next week. North American Lobster Tails- Market is weaker. Light demand combined with new season product coming to market is putting downward pressure on the market. Salmon- Market is unsettled. Inventories are good for a light demand. Retail demand has been very good for several weeks with Foodservice demand beginning to improve as additional states ease dining restrictions. Cod- Market is unsettled. Demand has been varied across the country due to dining restrictions disrupting normal dinning patterns. Flounder- Market is steady. Haddock- Market is mostly steady. Pollock- Market is unsettled. Larger sized product is in limited supply due to recent catches being more on smaller sized fish. Domestic Catfish- Market is unsettled. Retail demand has been very good the past few weeks and putting pressure on available inventories. Tilapia- Market is unsettled. Retail has seen a large increase in demand the past few weeks and helping to move additional inventories. Production costs overseas have been rising and keeping the market in an unsettled tone. Year to date total imports are up almost 38% compared to YTD 2019. Swai- Market is steady to weaker. Light demand is putting downward pressure on the market. Year to date imports are down almost 33% compared to YTD 2019. Scallops- Market is steady. The 2020 Atlantic season opened on 4/01. Demand is light and new season fishing is helping to build inventory levels. Fishing in Japan and China are in their off season and helping to hold those markets steady.

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DAIRY Cheese Market is firmer. The CME block and barrel market climbed higher this week. It has now been six weeks since the market plummeted to its lowest point since 2009. The drastic fluctuations in production and demand has left cheese production in a quandary. Milk production is now lighter as dairies take steps to reduce herd size. Additionally, in certain areas spring flush has passed its peak.

National purchase programs by the USDA have drawn down inventories for some producers. In the northeast production is steady. Producers in the region are no longer dealing with abundant milk supply. Demand for foodservice is beginning to pick up. Retail demand is stable. Midwestern region producers are staying busy. Demand has increased as customers seek to refill supply. In the west market uncertainty is ongoing. Producers are carefully weighing production schedules.

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Butter Market is unsettled. The CME butter market moved both higher and lower this week. Nationally the butter market is beginning to recover. Demand for foodservice segment is slowly increasing. Retail demand for prints remains strong. Butter inventories are ample and building in cold storage. Retail sizes

have also seen a rush from the USDA box program awards. In the northeast inventories are adequate, production is mixed in the region. Central region producers report increasing foodservice demand. Otherwise reports on production and cream availability are mixed. Western producers report bulk butter demand as good although foodservice has slower to open than in other regions. Space has begun to free up in cold storage.

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EGGS Market is steady. Retail demand is being reported as fair to good. Promotional activity is starting to reemerge as lower price points allow grocers the opportunity to feature shell eggs. Foodservice volume continues to improve but is still being reported as light. Fast food QSRs featuring all day breakfast menus continue to carry the foodservice channel for the current time. Supply is available on both medium and large sizes. Market is trending flat on medium and large sizes. National weekly shell

egg inventory reports shell egg inventory down 1.5% over last week.

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SOY OIL Market is firmer. As the country continues to open and push the demand for soy higher, the market has nowhere to go but up.

WHEAT/FLOUR The market is moving upward as demand continues to grow in foodservice.

NONFOODS - GLOVES

Manufacturing is operating at reduced capacity in glove producing countries. With worldwide demand increasing in all industries, the supply chain is experiencing significant disruption. The disruptions are expected to continue through at least the end of the year.

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For questions regarding the markets, please contact the appropriate Category Manager:

Scott MacKaben, Senior Vice President of Procurement, ext. 5457

Beef, Pork, Seafood: Davy Ard, Director of Category Management, ext. 5431

Poultry, Eggs: Ken Kotecki, Category Manager, ext. 5463

Oil, Wheat, Grains, Canned Products, Imports: Willie Biddix, Category Manager, ext. 5433

Non-Foods, Spices, Dairy: Angie Rivera, Category Manager, ext. 5427

Beverages, Frozen Vegetables: Crystal Wilkins, Category Specialist, ext. 5451

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