September 2023 Market Update

Now that we are past the Labor Day holiday, which represents the last major grilling weekend of the summer, beef prices have softened slightly but remain at historically high levels.

With continued high feed costs and ongoing drought conditions in key cattle raising areas, ranchers remain reluctant to increase their herds.

Despite higher beef prices amidst ongoing inflationary pressure, as well as lower priced chicken and pork alternatives, beef continues to be popular among consumers which is supporting higher prices.

Availability of premium (CAB, SS, & PSA) grade beef continues to be limited due to resilient consumer demand. However, the availability of prime grade beef has improved due to softening demand in the face of higher pricing. Big box stores such as Costco and Sam’s Club have cut back on their prime beef offerings as consumers trade down to lower cost Choice and Select grades.

• Ribeye pricing has been increasing as both the retail and foodservice segments have been booking supplies as we enter the fall months.
• Striploin pricing, which was at historically high levels, will be decreasing significantly over the next month.
• Flap Meat pricing has finally started to decrease now that we are past the Labor Day holiday.
• Chuck flat pricing will be decreasing as export demand in Asia has softened due to lower beef consumption in those markets.
• Chuck Roll pricing continues to remain strong as retailers are featuring more economical ends cuts with budget conscious consumers in mind.
• Sliced beef short rib prices will be increasing over the next month amidst the ongoing cattle shortage and less cattle being sent to slaughter.
• Oxtail prices will be increasing as we exit the warmer summer months and enter the colder fall months.

For the remainder of 2023, we should expect higher beef prices as the supply of market-ready cattle remains limited. Additionally, we should expect continued volatility as consumers deal with higher prices.

The spread of the HPAI bird flu has subsided this summer but continues to be an ongoing concern for the poultry industry.

With many parts of the country experiencing excessively high temperatures, the poultry industry has seen a higher mortality rate amongst birds. Additionally, the hot temperatures have resulted in lighter bird weights for poultry producers.

• Bone-In Thighs – Availability for Bone-In Thighs continues to be limited as retail demand has increased simultaneously with labor issues at poultry plants. With less availability, we are seeing higher prices as sourcing product continues to be a challenge.
• Boneless Skinless Thighs – Boneless Skinless Thigh prices have been increasing as retailers feature poultry more heavily in their ads.
• Leg Meat – Chicken leg meat prices were stable but have been increasing due to strong domestic demand.
• Breast Meat – Breast meat prices continue to increase as retailers feature chicken more prominently.
• Wings – Wing prices, which were at historically low levels, have finally started to increase with these low prices attracting interest from the retail segment.
• Turkey – Availability has improved primarily due to turkey suppliers raising more birds fearful of the HPAI bird flu decimating their flocks. With this improved availability, we expect there to be an adequate supply of turkeys to meet the upcoming Thanksgiving demand.

Overall pork demand remains lackluster even with prices being at low levels. Although summer is right around the corner, we have not yet seen the normal seasonal increase in demand. Additionally, with COVID restrictions being lifted earlier this year, China has not stepped in to import U.S. pork as many had expected.

• Butts – Boneless butt prices which increased during the summer are finally starting to decrease post Labor Day holiday.
• Bellies – Belly demand and prices remain at higher levels, primarily due to Europe being short of inventory. European Union pork producers are unwilling to increase production given the current volatility in the marketplace.
• Back Ribs – Rib prices have stabilized and are in the process of settling at levels that allow pork producers to be profitable, yet still affordable for consumers.

Pork & Poultry Market Outlook

Overall pork demand has increased but is at lower levels compared to 2022. Even at these lower price levels, pork still trails beef and poultry demand amongst consumers.

For the poultry industry, chicken has been featured more prominently by retailers looking to present value to cost conscious consumers with limited budgets. With chicken being promoted more heavily, overall prices have increased for virtually all chicken parts.

• Snow Crab – The Canadian Season has completed their quotas. Prices have stabilized and will strengthen as inventory sits in cold storage. 8/UPs and larger sizes seem to be in popular demand and will command stronger prices.The Alaskan Season has yet to be determined. Alaska Department of Fish & Game will be going out in November to test the Biomass to see if there will be a season or not. If there is, they will start crabbing sometime in late December or early January.
• Alaskan King Crab – Alaska Department of Fish & Game is currently testing available Biomass. They should be announcing soon whether there will be a red season. If there is, they will also announce the Total Allowable Catch at that time. Pre-Ban Russian product in cold storage is still dwindling. Many suppliers that still have inventory are discounting to move product as they are nearing the end of their optimum shelf life.
• North-Atlantic Lobster Tails (Cold Water) – The next major season will start in November. This should produce larger tails (6 oz. and bigger). Small tails (3 oz. and 4 oz.) are in limited supply and pricing is firm. Smaller tails are popular with supermarket chains who sell by the individual piece or by the pair.
• Vanamei White Shrimp – Prices remain stable for all sizes and types of Pier Port shrimp, presenting a great opportunity for operators to add another seafood item to their menu to increase profitability.