Market Report 3/31

Good morning all! With help from Matt Cole I am bringing you a market report for you to look at or think about when you are dining out and asking why the prices are climbing or availability of some items are short of demand. here are some of the highlights of what to watch out for as you are reading or building your menu for spring. ground beef to go up 10-15 percent in the next year, lettuce getting hit hard by the weather swing, limes demand far exceeding the demand and poor quality just to name a few. this will directly effect how we are pricing and planning our menus. The days of a under 10 dollar burger are waning as beef and all the fixins are going through the roof. as demand increases it will only worsen the market and i suspect that if chefs are not using alternative cuts of beef or other meats already they will be quickly switching to them in the near future. below is some of the high points that i have received and look for the alternatives to push higher as the demand for them grows as well!

Thanks as always and I hope all has a great week!

Beef

Beef prices will likely be one of fastest-growing categories of food prices, economists predict. Already, thanks in part to cattle herds that are near 63-year lows and a recent drought in Texas, retail beef prices are near record highs (ground beef prices climbed 5 percent over 2013) and economists predict they will rise into 2015 or 2016. Kevin Good, a senior analyst at cattle research firm CattleFax, says that steak prices might climb 5 percent to 10 percent and ground beef prices 10 percent to 15 percent this year

Lettuce

Roughly 90 percent of the lettuce grown in the U.S. comes from California and Arizona, says Milt McGiffen, a professor in the Department of Botany and Plant Sciences at the University of California-Riverside. This year, the lettuce crop was impacted by wild weather swings in areas of southern California and northeast Arizona, including several days of below freezing temperatures. In 2011, when some freezes took place, lettuce prices jumped significantly from January to March. Some scientists blame weather extremes like these on climate change — and companies are taking note. This week, Chipotle filed documents with the Securities and Exchange Commission that said “increasing weather volatility or other long-term changes in global weather patterns, including any changes associated with global climate change, could have a significant impact on the price or availability of some of our ingredients.” They specifically noted that they might have to temporarily suspend items like guacamole and salsa from the menu.

Milk

Dairy prices remain high, with some analysts predicting a 10 percent or more spike for milk. This is thanks in part to increased demand from places like China, as well as slower-than-expected expansion of many dairy farms, says Sterling Liddell, the senior vice president for food and agribusiness at Rabo AgriFinance, a financial institution that lends money to farmers and agricultural businesses. Indeed, we’re already seeing higher prices, as the current farm price for dairy is up nearly 25 percent from last year

Pork

Pork prices this year are already high — up about 100 percent over the past five years and nearly 20 percent year on year — and will likely continue to stay high, says Liddell. This is partially due to the rapid spread of PEDV, or porcine epidemic diarrhea virus, a nasty bug that kills hogs, especially young ones, explains Liddell. “If the new litter is less than 15 days old, the mortality rate is very high,” he says. The decline in volume of pork this year may be up to 10 percent, he predicts, though an increase in weights of some hogs may make up part of that. “We’ll see even higher pork prices into the summer…in grilling season in July and August,” he says.

Tomatoes

California, particularly the Central Valley of California, is currently experiencing a record drought, and that is likely to affect tomato prices, says McGiffen. Indeed, the state produces roughly one-third of the fresh tomatoes grown in the U.S. and puts out a lot of the processed tomatoes too, says McGiffen. That means that consumers may see price increases in tomato sauce, salsa and canned tomatoes, says USDA research economist Richard Volpe; though, he adds that a price hike for processing tomatoes typically takes about six months to a year to trickle down into retail prices for processed foods

Cheese

Cheese prices are already up significantly. The price for block cheddar has climbed above $2 per pound — one of the highest levels in years — up roughly 22 percent from early last year; the price for mozzarella has also climbed steadily. And McGiffen says cheese prices might stay at these higher levels for a while longer. This is thanks in part to higher milk prices