The USDA’s end of November Cold Storage Stocks report is seen as BEARISH with expanding stocks seen for several red meat products. A very large expansion seen for Boneless Beef materials are well above the longer term average.
Pork stocks built aggressively for Pork Ribs, Pork Bellies, and Pork Loins relative to the past month and compared with the longer term average. Freezer stocks of Turkey are seen as very small, likely due to the outbreaks of Bird Flu that killed a lot of Birds this spring and summer. I am hearing in the trade that Turkey producers are having trouble getting quality Turkey eggs for hatching.
RAPIDLY BUILDING BELLY STOCKS DURING NOVEMBER: Frozen Pork Belly stocks were reported at 41,161 thousand pounds, compared with a month earlier at only 17,853 thousands and 35,894,000 pounds a year earlier. During November the Pork Belly stocks build at a greater than usual rate. Once the trade can assess the December USDA Hogs and Pigs Inventory report, this will give an indication about the likely hog slaughter rates for next spring and summer; the trade will be able to assess how many frozen Pork Bellies likely will be needed in freezer stocks.
BEARISH::Frozen Pork Rib stocks at the end of November are at very elevated levels. Frozen Rib stocks were reported at 116,764 thousand pounds, compared with a month earlier at 98,871 thousand pounds, and a year before at 76,897 thousand pounds.
Frozen Boneless Beef stocks, at the end of November, are at very large levels, 472,353,000 pounds, +29.3% above year earlier levels. The imports from Australia and New Zealand have been very elevated this year due to record high domestic Lean Beef Trimmings prices and a very strong US$. This has supported building frozen Boneless Beef stocks. In recent weeks, Domestic Lean Beef Trimmings prices have slipped below $200.00 per cwt. for the first time in several years. This report is seen as BEARISH for Lean Beef Trimmings outlook.
Frozen Turkey stocks are at much reduced levels, likely due to the outbreaks of Avian Flu that killed millions of Turkeys.