Source: Susan Kelly, MEATINGPLACE, 3/23/18


Growing U.S. inventories of frozen pork and poultry are generally bearish for meat protein prices, but lower beef stocks are constructive for beef prices in early spring, analysts said in the Daily Livestock Report (DLR), published by Steiner Consulting Group.

USDA, in its latest cold storage report, said total red meat supplies in freezers were down slightly in February from the previous month but up 1 percent from last year. Total pounds of beef in freezers were down 8 percent from the previous month and down 8 percent from last year. Frozen pork supplies were up 6 percent from the previous month and up 8 percent from last year. Stocks of pork bellies were up 6 percent from last month and up 188 percent from last year.

Pork piling up
The DLR analysts said they were surprised by a sharp increase in pork trimmings that went into the freezer during February. They also noted that pork belly stocks were 46.5 million pounds, significantly higher than the 16.2 million pounds on hand a year ago but still 16 percent  less than the five year average. “We expect more bellies to go into storage in March and April, which should help temper summer belly values,” the analysts wrote.

Poultry, too
USDA said total frozen poultry supplies on Feb. 28 were up 6 percent from the previous month and up 14 percent from a year ago. Total stocks of chicken were up 3 percent from the previous month and up 15 percent from last year. Total pounds of turkey in freezers were up 14 percent from last month and up 13 percent from a year ago.

The DLR noted that the supply of whole broilers and chicken parts in cold storage at the end of February was 905.2 million pounds, 15.2 percent higher than a year ago and 25.8 percent higher than the five year average. The inventory of boneless skinless chicken breasts remains some 30 percent higher than the five year average, the report said.

Beef demand seen robust
Beef inventories at the end of February were 460.3 million pounds, which is 4.1 percent lower than the five year average, the DLR said. “We think high beef trim prices and expectations for higher supplies in April and May likely induced some end users to deplete inventories,” the analysts wrote. “Beef imports and beef production year to date are higher than a year ago, leading us to think that the main reason for the lower beef stocks is robust domestic and export demand.”

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