Market Update July 14, 2017

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1 Center of the Plate Beef As we work through week two of the seasonal beef price downtrend we are starting to see prices for some items level out. Given the fact that beef production is running significantly higher than last year, the fact that prices for ribs, round cuts and ground beef are still well above last years levels may suggest some additional price declines. Ground Beef 81% Brisket Inside Round Ribeye Strips Ball Tips Tenders Flank Steak Current Week Down Down Down Down Down Down Down Down Next Week s Projections Flat Down Flat Down Down Flat Flat Flat Pork There was speculation in May that mild winter weather had accelerated weight gains causing hogs to come to market early. In the last few weeks hog numbers have been smaller than expected, which has tightened supplies a little. Add widespread retail featuring to the equation and the result has been higher pork prices across the board. We are starting to see some post-holiday price adjustments on ribs, and could see discounting spread to other pork cuts as the normal seasonal price downtrend gets going. Butts Hams Spareribs Loins Bacon Current Week Up Up Flat Up Up Next Week s Projections Up Up Down Up Up 2017 Gordon Food Service 1

2 Chicken Prices for most items are flat as supplies remain balanced. Thigh meat continues to see a good call, but production has been reduced by holiday schedules. We will see how the market holds up when we resume full production next week. Jumbo BNLS/SKNLS Breast Clipped Tenderloins BNLS/SKNLS Thigh Meat Jumbo Wings Medium Wings Current Week Flat Flat Up Flat Flat Next Week s Projections Flat Flat Up Flat Flat Turkey Frozen turkeys and bone-in breast are available and a little discounting is noted. Bone-in breast is seeing the most downward pressure. UB Hens, East, 12 lb. Frozen UB Toms, East, 22 lb. Frozen UB Turkey Breast, East, 8-10 lb. Current Week Flat Flat Down Next Week s Projections Flat Flat Down Seafood Cape Haddie Both haddies sizes have been converted to the shatter pack sku's from IQF. Please note and order accordingly Cod - Alaskan (1x Fzn) 2017 Gordon Food Service 2

3 The Alaskan cod supply has been adequate and costs have remained steady. Reports indicate that the are more readily available than the 8-16 but supply is available currently on both sizes. Cod - Atlantic (1x Fzn) The first shipment of the Canadian cod loins is back in stock with the start of the new season at the end of May June. Supplies are still slightly strained due the fish being smaller for the start of the season. As the fish grow we expect supply on all sizes to improve. Crab - King Market is steady for a lackluster demand. Costs have softened slightly. The largest sizes appear to be the shortest on the market at the moment in the 6-9 and 9-12 ct sizes. Crab - Snow The market continues to climb as the season begins to come to a close in Newfoundland. Overall the large sizes are the shortest in the 8 up and 10 up categories. 5/8 are the most plentiful, at the moment but have also increased in costs. Crab Meat - Pasteurized Prices have moved up as supplies have tightened late in Prices remain firm and supplies limited in the US as production overseas has been slow and demand has been good. Expect supplies to remain tight and prices moving higher on all types. Euro Fish & Zander Euro lake fish supplies have been adequate on all sizes of zander and perch. This is still a cost effective alternative to the domestic lake fish perch and walleye sku's. Gator Adequate supply for adequate demand. New season begins in September. There has been a slight up tick on the farmed costs while wild gator currently is the better value. Grouper Grouper is steady in cost for a relatively active demand. We expect supply to continue with no issues Lobster - Brazil The Brazil season is just underway. Are awaiting to hear new season costs and landings thus far. In preparation for new season arrivals costs have softened. Lobster - North Atlantic The season is still slow at best. Availability of the larger sizes has been very sparse as they are typically harvested in the late fall. Costs have remained firm with some discounts on key sizes. There is added pressure on cost with whole cooks being exported to Asia and that lack of supply 2017 Gordon Food Service 3

4 has put added pressure on product coming into the US. Meat costs are still firm and product is available. The Maine season will open soon and there is some hope for relief on supply and cost. Lobster - South African Cost elevates. Demand weak Mahi Mahi The mahi mahi season is still under duress as recent reports out of Taiwan and Viet Nam suggest that this season was also reduced drastically by as much as 55-60% compared to harvest and landings the previous year. Those containers that do land in the US have also been detained by the FDA for further testing. With the new S American season beginning in October, it will be some time before the supply will fill in from the lack of product. Therefore we do no expect any relief on cost until after the first of the year Mussels Good supply at a competitive cost Ocean Perch Canadian supply is steady for a consistent demand Orange Roughy Supply consistent but demand has been slow. Both sizes are available Oysters Oysters with the larger meat sizes have been hard to come by this season. There has been some salinity problems in the gulf due to dredging and widening of bays off the coast ot Texas and Alabama and reported dead zones left over from the BP oil spill that have affected the harvest of quality oysters. Expect to see increase in costs as well due to these reasons. Perch & Walleye Yellow lake perch is readily available this season in all sizes. Note all are active in the Michigan sized splits and butterflies in additions to the Ohio sized splits and butterflies. Costs are softening slightly but still remain high in relation to other seafood commodities. All sizes of walleye are also available from the 2/4 oz sizes up to a 14 up. Costs are softening slightly here as well but still remains elevated. There should be n o supply gaps through the summer and fall for this season. Pollock - Atlantic(1x Fzn) First reports for the start of the Alaskan B (summer) season state that the fish are still very small and they do not expect any significant amounts of the 4/6 in IQF or SP and or the 6/8 SP as well. Currently we have adequate supply on the 2/4 shatters and IQF and some 4/6 SP. Please note and plan for the late summer and fall seasons now. Salmon-Keta Inventory is tight. Expect portion prices to continue to increase Gordon Food Service 4

5 Salmon-Pink Demand continues to be steady. Year to date pricing has remained relatively stable. Salmon-Sockeye Demand continues to increase. All salmon species report high prices relative to historical terms. Prices are projected to increase 15%-20%. Salmon-Coho Demand has exceeded supply in the market. Many producers report sales doubling in the last 10 months. prices are now up to historical highs along with other salmon species. Scallops The scallops costs took a dive in May with very lows costs. That has started to rebound some but landings etc have been good thus far. Expect costs to be lower than previous years as there was an increase in quota for the 2017 season. Sea Bass Supply adequate for a slow demand. Costs remain elevated Shrimp - Asian Black Tiger Black Tiger shrimp remain in difficult supply. There is very inconsistent supply and elevated raw material prices overseas. Vietnam prices in particular are disconnected from US markets leading to a boom or bust scenario on Tigers this year. End users will have product, but prices will reflect the challenges in raw material availability. Shrimp - Asian White Asian White shrimp are steady in price with good supply. Large sizes (13-15 P&D Tail-On) was short towards the end of June, but availability should be better going forward. Shrimp - Domestic Peeled (PUD) Dometic Peeled shrimp prices are at great levels vs. 5 year averages. End users who are looking for a great value should look at small peeled shrimp for all types of creative applications. Shrimp - Domestic Rock & Pink Rock shrimp remains short. There is potential for more to be caught in the fall, but fisherman will only target the species if they are having success. Pink shrimp remains a very good alternative to rock shrimp and is readily available. Shrimp - Domestic White & Brown Headless 2017 Gordon Food Service 5

6 Domestic White shrimp production has been steady with only a few gaps in sizes (26-30 & headless shell on). Brown shrimp production will begin to ramp up into the month of July. Snapper Supply and demand adequate. We do not anticipate any issues with supply in the near future. Tuna - Frozen Tuna supplies are adequate for steady demand. Costs should soften slightly over the next few months. Whitefish Whitefish is plentiful at the moment on all sizes. Costs have remained steady for some time and are a value compared to other domestic lake fish items. Dairy Dairy Category Last Week Current Week Block Cheese Up Up Barrel Cheese Down Up Butter Up Down Large Eggs Up Up Medium Eggs No Change No Change Small Eggs No Change No Change Cheese The CME block and barrel markets have found a comfortable spot in this bearish environment. Speculators feel there will be more of the same in the coming weeks. Eggs Retail demand fairly good to good. Larger sizes well balanced to close. Market steady to full steady. Butter Production is slowing but inventories are still in good shape. The market continue to be up based on the pull from European markets Gordon Food Service 6

7 Grocery & Bakery Wheat Spring wheat crop conditions are getting worse, with only 37% of the crop rated good-excellent versus 33% poor to very poor. Pizza flour prices have increased 10%/week for the last few wheats as higher costs get passed through. Last weeks high gluten flour quote is 40% above last year -- the highest cost in 3 years. High-Gluten Flour Semolina Pasta Flour Current Week Up Up Next Week s Projections Up Up Soybean Oil Crop conditions for soybeans slipped a little as parts of the western corn belt enter mild drought conditions. It is way to early to talk about lower soybean yields, but forecasts for hot, dry weather have put a risk premium back into soybean futures. Current Week Next Week s Projections Soybean Oil Flat Up Sugar Sugar beet processors tightened up the low end of bids they are willing to accept, keeping prices firm. Current Week Next Week s Projections Sugar Flat Up 2017 Gordon Food Service 7