Canada Beef market intelligence update: U.S. restaurants re-open as vaccinations roll out

As the U.S. dampens the pandemic, restaurants are re-opening, with some states eliminating all restrictions. On the retail side, demand for beef continues to outpace other meats and plant-based protein. Meanwhile, demand for Canadian beef remains strong, with imports up slightly over last year.

Restaurants are open in all states in the U.S. As of March 31, 12 states had removed all dining restrictions, including Texas, Tennesse, South Dakota, Oklahoma, South Carolina, Nebraska, Montana, Massachusetts, Mississippi, Iowa, Florida and Arkansas.

Restaurant buys will soon weigh into the wholesale price for Choice cuts. Choice primal prices already have a significant edge over last year. Choice rib was up 11 per cent year-to-date as of March 26, with Choice chuck up eight per cent and Choice loin up nine per cent.

Choice round has been steady in 2020 so far, but Choice brisket was down 10 per cent. The price trends are the same but subdued for Select primals.

There is still a risk of a third wave affecting the U.S. wholesale or foodservice sectors, but the U.S. is leading vaccinations globally. At the end of March 2021, food processing employees became eligible for COVID-19 vaccinations in 26 states.

Retail beef demand strong as summer approaches

Fresh beef imports are headed to retail where beef leads the meat department in volume and value. In February 2021, sales of fresh beef were up 17.2 per cent in value and 11.2 per cent in volume from last year. The all-fresh retail price of beef notched up in February 2021 for the third straight month. At CDN$13.90/kg in February, the all-fresh price was up 0.2 per cent from January 2021 and 6.2 per cent from February 2020. Warmer grilling weather is expected to keep the coals burning on the retail beef market.

Ground beef sales in February 2021 were up 9.6 per cent in value leading grind sales at retail (in absolute dollars). Ground beef’s market share in February 2021 was 83.7 per cent. Market share for ground turkey was 11.8 per cent, followed by ground chicken at 1.8 per cent and ground pork at 1.4 per cent. The market share of plant-based grind products was one per cent in February 2021, with continued aggressive growth (+85.2 per cent) in value compared to last February.

Canadian beef demand up slightly

U.S. demand for Canadian beef remains strong in 2021. Canadian exports to the U.S. totalled 24,875 tonnes in January 2021, up 5.5 per cent in volume and 7.9 per cent in value from January 2020. The average price was CDN$7.50/kg in January 2021, up 2.3 per cent from last January (Statistics Canada).

Product mix trends have shifted. In January 2021, fresh product increased, totalling 21,505 tonnes and up 7.4 per cent (+1,480 tonnes) compared to January 2020. Fresh product market share was 86.5 per cent in January 2021, compared to 84.9 per cent in January 2020. Imported loin products were of interest, with fresh bone-in loin at 42.5 tonnes, up 35.8 tonnes or 536 per cent from January 2020. Imports of frozen boneless loins totalled 45 tonnes, down 35.4 tonnes, or 44 per cent from last January. Total frozen import volumes were up slightly in January 2021, and offals and processed beef were down.

In January 2021, the USDA reported that U.S. beef imports from Australia and Mexico were down 47 per cent and 18 per cent respectively from January 2020. Imports were up from New Zealand (+46 per cent), Brazil (+112 per cent), and Uruguay (+ 84 per cent).

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