Market Updates for May 3, 2019

Section Type

Dairy | Cheese

The CME Block and Barrel markets have held steady with the Block showing some bearish movement.  Speculators feel this is due to the ample supply in the current markets satisfying the demand.  This environment should continue in the short term.

Last week:

Block - Up

Barrel - Up

This Week:

Block - Down

Barrel - Up

Dairy | Eggs

Retail demand only fair. Supplies available. Marker seeing additional direction

Last week:

Large - Down

Medium -No change

Small - Down

This Week:

Large - Down

Medium -Down

Small -Down

Dairy | Butter

Butter production continues to be active and inventories continue to grow; expectations are for butter pricing to stay relatively stagnant on the spot market over the next few weeks prior to the butter inventory is reset with current levels and previous inventory is ‘wiped out'. 

Last week:

Butter -Down

This Week:

Butter - Up

Seafood | Finfish

Cod, Alaskan 1x:

Alaskan cod had a firm undertone for most of Lent and costs remain at this level. Currently there is plenty of supply  

Cod, Atlantic 1x:

The 1x frozen Atl. cod loins have come up short for the season out of Canada. Adverse weather and reduced quota have resulted in  limited catches for the fishermen at the end of the season.  Canada does not resume until June.  1x frozen Iceland product of the same weight variance and spec  will be a good option on supply moving forward.     

Cod, Atlantic 2x:

2019 Total Allowable Catch is announced at 6.5% lower than 2018.  Prices will remain firm. 

Cod, Pacific 2x:

Due to lower catch announced from Atlantic cod. Pacific cod raw material price remains high.

Pollock, Atlantic 1x:

The overall Pollock quota has remained fairly stable.  Reduction in quota out of the Gulf of Alaska has been offset  by increases out of the Eastern Bering Sea for the most part.  The smaller 2/4 have been easier to come by where the 4/6 in shatters or IQF remains shorter until the B season this summer.  Costs have firmed 

Pollock, Pacific 2x:

Firming of pricing as expectation of drop in pollock biomass. Starting to see substitution demand from cod and haddock users.

Haddock:

15% decrease of Total Allowable Catch announced for haddock.  Price is still cheaper than cod.  Expectation of cod substitution to continue. 

Domestic Lake Fish:

Supply of Yellow Lake Perch, Walleye, Whitefish and Smelt has been plentiful  through Lent.  At the end of March the  Lake Erie Committee (LEC), set a total allowable catch (TAC) for 2019 of 8.552 million pounds of yellow perch and 8.531 million walleye. Yellow perch are allocated in pounds and walleye are allocated by number of fish. This TAC represents a decrease for yellow perch from 10.498 million pounds of fish over  last year, (about a 20% decrease overall) and an increase in walleye from 7.109 million fish (about a 20 % increase overall).     As a result perch prices have risen quickly and product has been short especially on the smaller Mi sizes.  Note the new season formally resumes in May but expect perch on all sizes to be short  for the balance of the year .  Walleye has started to see softening on costs with the increase in quota.  When the season resumes in May we expect some continued reductions, for now walleye is available  on all sizes.     Whitefish currently has ample supply with the new season resuming in June.  Smelt for both battered and dressed has started to tighten slightly on supply so expect costs to firm as well.  The Canadian blue gill continues to be a struggle as catches and supply have come up short.  What is being offered will need to remain on allocation.  The next best option is the same species but produced out of China.    Supply is available but another increase will follow as all imports now out of China are impacted by the 10 % tariff.                       

 

 

Euro Lake Fish & Zander:

Supply is ample and costs softened over time but are leveling off as we go into the summer months.      

Mahi Mahi:

Mahi Mahi costs for this season softened closer to 2013 and 2014 levels earlier in the year but as we moved through Lent and as the S American season has wrapped up costs started to firm   The season for Peru will not reopen  until October.   The next avaibale resource is Taiwan and that season should resume shortly.   Currently supply is adequate for a strong demand.  

  

Frozen Tuna, Swordfish :

INDONESIA – There are only a few regions in Indonesia landing raw material and those are minimal. With the lack of raw material, prices are firm and high from this region. Their season will start in late March/early April. Prices may find relief at that time, depending on the strength of those landings. Thailand – Landings are very minimal.  .  For Swordfisn, in Ecuador – all the boats have been fishing for Mahi, so there has been virtually no production. They will retool for Sword in March/April. Pricing will be reviewed at that time.  In Asia (Vietnam & Indonesia) – European demand continues to be much higher than usual, putting pressure on supply and pricing. Landings are tied directly to Tuna, so the notes above also apply to Sword.Thailand – Only processing frozen on-board product at this time. As a general rule, all of it is untreated. Landings are low. Prices are high and creeping up. Overall Limson has supply on all sizes with stable costs at this time

 

 

Swai:

Raw material source is currently more than packer’s demand to the farmers.China is slowly buying as they still have inventory from purchases placed prior to Chinese New Year. The U.S buyers remain quiet as there is ignificant inventories being held in U.S. freezers at much higher costs than current replacement prices. Production should increase in May and June so chances are prices could soften further but we will have to see if China and the EU steps in and becomes more active.

Tilapia:

The tariff war has increased costs of product by 10% .  The potential for  another 15% increase has now been delayed until the beginning of March by the Trump administration.   

Seafood | Shrimp

Imported Black Tiger:

Indonesian Black Tiger raw material is stable with low quantity. Farmers raised the prices on the larger sizes as main landings are 16/20 thru 26/30. India’s prices are cheaper but the Indo packers will not lower price to compete with India. Current U.S inventories are more than adequate for dull demand.

Imported White:

INDIA WHITE SHRIMP Raw material arrivals continue to be slow with firm pricing at least for now until farmers start the new harvest of 2019. Packers have tried to lower the raw material prices to the farmers with no success. Main request for pricing overseas from USA buyer is medium to larger sizes of PTO and EZP which is most likely earmarked for the retail sector. There were no large volume deals made during SENA 2019 as most buyers wait on the sidelines for next harvest. The current market is stable with discounts noted on smaller peeled shrimp. Demand has been steady for 21/25 Headless, shell on Asian Vanamei whites and 16/20 thru 26/30 EZP shrimp. INDONESIA WHITE SHRIMP Raw material is stable with major landing sizes in 31/40 ct. More quantity of bigger sizes become available each week on 26/30 and up.Price of raw material has remained stable as packers are waiting for the next crop in May which will shift down to 41/50-51/60 sizes. U.S. inquiries are slow as many importers have good stock available and only buy on a need be basis.  There have been some requests on the larger sizes (13/15-26/30) but packers main focus is on smaller sizes as they have heavy stock with May harvest around the corner. Indonesia packers are more aggressive than India on certain items and accept counters where the gap between offer and acceptance is not too far apart.

Latin White:

Latin White shrimp are firm with replacement prices firming. Supply is good for the time being.

Domestic White & Brown:

Domestic Brown shrimp are steady in price as we roll into the new season for Texas. Larger sizes of white and brown headless shrimp should begin to land over the next few months.

Domestic PUD:

Domestic PUD production has slowed on smaller shrimp. While boats begin to target larger whites and browns where available, we should see better production in larger and middle size peeled shrimp.

Domestic Rock & Pink:

Rock & Pink shrimp are both in good supply.

Seafood | Lobster

North Atlantic:

Landings were initially reported to be down 30-40% in early December out of Nova Scotia.  It was assumed a 2 million lb + shortfall of meat, as well as 4 million lb + shortfall of tails .  Most sizes from the processors are on allocations with limited to no inventory on sizes larger than 5-6oz.   Some indications were that landings improved, but the damage had been done when the shore price reached extreme highs before the holidays and many processors closed for the winter.  Spring season starts in early May, but initially  a lot of this goes to live or whole lobster production in order to avoid a bottle neck from tail and meat production. Realistically look at improved availability in early June.  For now prices are high with limited  to no supply on 6/7 oz tails.  Meat bottomed out this winter but costs have rebounded and started to firm again as supply on both tails and meat is scarce at this time 

 

 

Warm Water:

Supply has been short on warm water tails  after a late start to the season last summer.  Poor catches, increased demand out of Asia  and retailers taking a stronger position on the market have resulted in a firm undertone.     This trend continued through the holidays and is expected to remain firm until new season supplies start to arrive in July.     The WW tails in the 6 and 8 oz sizes might be a viable option to the lack of larger N Atl tails but  costs are a trade off as both species report a firm market and overall lack of supply.  

 

Seafood | Crab

Snow Crab:

The global shortage of snow crab continued  through the fall.  What did come out of Alaska was mostly of the 5/8 oz size and the bulk was presold or of  very limited supply.   First indications out of Canada are that the volume will remain stable and at best 1-2 % above last season. Qouta cuts out of Newfoundland are being offset by increases in other regions.    They expect predominatly the 5/8 oz size  with limited offers in the 8 up and 10 up sizes .  The market is volatile as the season started this month with USA buyers  waiting to see what pricing is going to look like. The “Ice Pack” on the fishing grounds is quickly going away and delayed openings in all fishing zones is not expected. Northern Gulf’s (Zone 17, 16) quota is ↓15% with Zone 17 opened on March 27th, and Zone 16 opened on April 9th. Nova Scotia’s quota is ↑7% and opened April 1st. Southern Gulf’s (Zone 12) quota is ↑~35% (Awaiting final quota) and opening mid/end of April. Newfoundland’s quota is ↓7% (not as much of a reduction as some thought) and opened the week of April 8th. Only Newfoundland/Labrador and Nova Scotia will be MSC certified this season. Please note that it is anticipated that the Japanese will buy less Canadian Snow Crab this year due to increased purchases out of Alaska and therefore more product could be available to the USA.  For now it is more of a wait and see approach to see where the market and supply will land.   In general 5/8 is the better value to the firm prices and limited offerings on the the 8 and 10 ups where many processors are limiting the offers on the larger crab to move the 5/8. 

Red Swimming Crab:

A new 10% tariff on all seafood items should go into effect in August.  The market is still uncertain however, between high market prices, and limited supply, cost might go up.  This coupled with the void in the market on red swimming crab only strengthens this possibility.  We are still expected to start receiving shipments on red crab in October.  The main crab harvest is October – December. 

Blue Swimming Crab:

Prices are still high with great inventory.  There has been a slight decrease in pricing from Indonesia while Philippines and India move up to be more in line with Indo.  For the next 60-90 days prices will stay level to a possible dip however, Q4 is expected to pick back up.  With the red swimming still high with limited supply, this too drives the price up.  Overall prices will come down a bit.

Seafood | Scallops

The scallop market is softening on most sizes as the season resumed in April .  A water level of new season costs has yet to be determined.   As the catches continue we expect more availability of supply of all sizes.   

Chinese Flounder and Ocean Perch:

10% tariff duty has been applied.  The possible  added 15% has now been pushed back to the beginning of March when the Trump administration will decide on a final ruling.