USDA’s monthly Cold Storage report indicates a sharp reduc ...

1 Vol. 12, No. 122 / June 24, 2014 USDA s monthly cold Storage report indicates a sharp reduc on in frozen meat and poultry inventories rela ve to one year ago and par- cularly bullish May inventory changes for beef and pork. Cut by cut data from Monday s report appear in the table on page 2. Some highlights are: Total beef, pork, chicken and turkey inventories on May 31 are es -mated to be billion pounds, higher than on April 30 but nearly 16% below last year s level billion pounds. As can be seen at right, levels of product in cold Storage the past three months are very near the lows of the last five years while last year s invento-ries were the largest seen during that period thus making the year-on-year changes quite large.

2 S ll, these total meat and poultry stocks are the lowest since 2007 and are 10% lower than the average level for May 31 over the past 5 years. Beef stocks led both the year-on-year and monthly declines in frozen inventories. The million pounds of beef in freezers on May 31 was lower than one year ago and lower than last year. As is always the case because of their large share of total frozen beef stocks, boneless beef was the big driver of the decline, a normal fact whose impact is exacerbated this year by significantly lower domes c cow slaughter.

3 Pork inventories with the notable excep on of bellies stocks were also sharply lower for the month. Total frozen pork stocks were pegged at million pounds, lower than last year and lower than last month. Rela ve to last year, only bellies (+57%), loins (+3%) and variety meats (+ ) stocks were larger. Hams ( ), Other Pork ( ) and Unclassified pork ( ) were the big driv-ers of the decline in pork stocks rela ve to last year while ribs were the biggest contributor in terms of both percentage ( ) and ton-nage ( million pounds) to the monthly decline.

4 The million pounds of bellies in freezers on May 31 con nue this year s pa ern be er safe than sorry behavior by processors. We s ll believe that is a func on of both wild popularity for bacon this year and painful memories of one year ago when stocks were ght and processors had to scramble to meat bacon needs, pushing bellies prices to then record highs. Those highs were eclipsed by the panic-driven buying of March but the stocks have served their purpose, keeping bellies prices slightly below year ago even as all other cuts set records and bacon demand marches merrily along.

5 June normally marks the beginning of the seasonal downturn for bellies stocks, a downturn that may occur in spades this year as hog numbers ghten. But remember that inventories are measured in pounds and these 215 pound average hog carcasses are yielding some HUGE bellies. Frozen poultry inventories grew sharply during May. Chicken inventories on May 31 amounted to millin pounds, higher than at the end of April. Just over 424 million pounds of turkey were in freezers on May 31, more than last month. Both poultry totals were, however, significantly lower than one year ago sugges ng that both sectors are far more current.

6 The year-on-year decline in chicken stocks was led by leg quarters whose inventory fell by almost 50 million pounds (30%) versus May 2013. Stocks of frozen wings also contributed greatly to the year-on-year change, falling by million pounds or 25%. Finally, the amount of Other chicken declined by million pounds ( ) from one year ago. This category is obviously a catch-all but it would include stocks of processed chicken items such as nuggets. Not sur-prising given the ubiquitous nature of chicken in foodservice apps, it is consistently the largest category of chicken in cold Storage .

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10 Just go to to contribute by credit card or send your check to The Daily Livestock report , Box 2, Adel, IA 50003. Thank you for your support! 1,7001,8001,9002,0002,1002,2002,3002,400 JFMAMJJASOND'Mil. BEEF, PORK, CHICKEN & TURKEYR ange '09-'1320132014 Avg. '09-'13yyPct. Chng. vs. '13 = : USDA NASS cold Storage , various edition010,00020,00030,00040,00050,00060 ,00070,00080,00090,000100,000 JFMAMJJASONDT hous. BELLIESR ange '09-'1320132014 Avg. '09-'13 Vol. 12, No. 122 / June 24, 2014 Sponsored by Product5/31/134/30/145/31/145/31/134/30/ 14 Chicken Whole Chickens139788,448 7,119 Hens, Mature Chickens50445,472 4,851 Breasts & Breast Meat108360108,812 117,682 Drumsticks1690225,127 28,685 Leg Quarters165098100,723 115,511 Legs1056913,320 13,957 Thigh & Thigh Quarters74768.