Weekly Market Newsletter

Leading Food Distributor

Serving the Southeast and

the World Since 1925

_______________________________________

We insist upon top quality products

from nationally recognized manufac-

turers. Our broad inventory consists

of more than 64,000 stocked items,

from gourmet to everyday.

Never content to rest on our laurels,

we strive to continuously improve and

innovate our products and services.

This commitment to excellence has

served our customers well for more

than 95 years, and continues to serve

as our standard for success.

-Byron Russell

Chairman & CEO

______________________________________

THIS WEEK ■ Market Update and Transportation Facts

■ CBI Food ServiceTrends New Products

■ Coming soon to CBI Produce

■ What’s New from Coast to Coast

■ Commodities at a Glance

■ RPE Insider

■ CBI Dairy Update

■ CBI Produce and Commodity Report

■ Produce West

■ Restaurant Industry News

■ News in the Grocery Trade

■ National Weather Spotlight

Riviera Location

800.432.1341 One Cheney Way

Riviera Beach, Fl. 33404

Ocala Location

800.939.4018 2801 W. Silver Springs Blvd

Ocala, Fl. 34475

Punta Gorda Loca-

tion

941.505.5885 One Cheney Way Punta Gorda, Fl.

33982

MARKET NEWS

Tifton Location

229.387.2553 7833 Magnolia

Industrial Blvd. Tifton, GA 31794

APRIL 29, 2022

Macroeconomics

The stock market was mixed on

Wednesday as the technology sector

weighed on the market. The NASDAQ

was the worst performer as it slipped 2

points to 12,489. The S&P held onto

green numbers managing a 9 point ad-

vance to 4184. The Dow rose 62 points

to 33,302. Gold prices slipped back be-

low the $1900 level while the energy

markets had a significant turnaround

midday. Heating Oil futures are the best

approximate for diesel they are continu-

ing their runaway move back to the peak

prices seen at the Russian Invasion’s

onset. As the world looks to change its

trade channels and alliances, what is the

new regime going to look like? Countries

are taking protectionist measures and

becoming more insular. The Just In

Time supply chain model works in times

of cheap energy and relative global

peace. What is the new normal calling

for?

Opening Call

Soybeans — Up 3-5 cents

Soymeal — UNCH to up $1

Soy Oil — Down 40-50 points

Information contained herein is based on reports, communica-tions, or other sources believed to be reliable. Neither the information contained herein nor any opinion expressed shall be construed as a solicitation to buy or sell any securities mentioned, but merely an expressed opinion.

Calendar

Today: Export sales, Jobless claims, EIA Natural Gas,

Friday: CFTC COT, March Crushing Data

Quotable:

“The best form of government is that which is the most likely to prevent the greatest sum of evil.”

Morning Market Comments

April 28, 2022

Soy Complex

It was another off to the races day in the soybean oil market yesterday. Fu-tures set another round of contract and all-time highs as Indonesia surprised the market with more restrictive export bans than previously expected. The additional measures brought more fu-tures buying to the CBOT and the mar-ket shot higher. With oil share attract-ing much of the attention, it was able to extend its calculation to 49%. The soy-bean crush market shot higher in the nearby months while the deferred posi-tions did not fare as well.

On the data front, Export sales were released this morning. Soybean oil ex-ports were 10k T which was up 84% on the week. This time of year, that’s a pretty good number for the US but in the given vegoil export uncertainty globally, we would expect this summer to see strong export numbers. The USDA is already too low on exports so this will likely have to continue to work higher in the forthcoming WASDE re-ports. Also of note was the Corn export number—specifically the 729k MT of corn to China. As China increases their corn intake for feed use, they will re-quire less soybeans for meal (feed) production. As they make less soy-bean meal (from their crushing their soybean imports), they subsequently make less soybean oil. Less soybean oil means that they will have to import more palm oil for food use. Now with Indonesia shutting down their export program(s), the Chinese will have to look elsewhere for the time being for immediate needs. Canada doesn’t have it to spare, Ukraine isn’t a reliable supplier, and the South American crush has been slow to pick up. Watch for unusual trade flow and think about what it means for the next domino in the chain.

Looking into the Crystal Ball, even a limit down move today would fail to crack 80 cents in July futures. Some are holding out for lower prices and the limiting factor may simply be time.

Mexico – We are seeing more availability out of Mexico on sizes however, the size curve is peaking on 48ct at about 22% of the Calavo pack with 60s trailing at about 16% of the Calavo pack. #2 fruit is making up 20% of the pack for Calavo. Organic supplies, while winding down are still available, although field price there is also elevated. Current crop

outlook is for tight supplies until the end of the season in late June. Jalisco fruit is ex-pected to arrive with first loads into the US around the middle of June, as that situation

is still being worked out amongst the regulatory bodies involved.

California – Harvest was increased about 33% week over week but even with a 33% increase, supplies are still expected to not meet demand as Mexico is still trying to catch up. A possibility exists in supplementing markets in the Midwest and Eastern US with domestic fruit, but high cost of transportation and fuel surcharges must be taken into consideration. Organic supplies are decent, with volume being promotable for the next

handful of weeks. #2 fruit is averaging at 8% of the total California pack. GEM avocados are available. If interested in the GEM program, please reach out and let us know.

Short Term Outlook –Stronger volume out of California, GEM harvest is underway. Elevated field price as Mexico looks to meet the volume needed for Cinco de Mayo pro-

motions.

Long Term Outlook – Strong field price as Mexico closes out its season. California supplies will help fill orders on the west coast, but pricing will remain strong through the

end of the MX season into late June.

A Fuel surcharge may be added to all prices at time of shipping.

Melissa Brucker | Food Service Account Manager

1141A Cummings Road | Santa Paula, CA 93060

Office (805) 921-3249 | Cell (805) 504-5423

MelissaB@Calavo.com

4/29/22

Conventional Items

Lettuce

Supplies remain sufficient for most shippers with varied quality and tiered pricing. Demand is good for aggressively priced let-

tuce. Below normal temperatures should continue to cap overall supplies at current levels . Quality remains varied with a wide range of

Color, Texture and sizing. Production from Las Cruces , NM has commenced with excellent Quality to start their season providing re-

duced transportation cost to the East Coast.

Leaf Lettuce

Romaine and Romaine Hearts Production remains mostly steady with modest demand . Quality and overall cool tempera-

tures has kept volume in check . Pricing on carton seems to have settled with volume deals available on romaine

hearts. Quality has receded with wide ranging color, texture , ribbiness along with fringe burn, mildew and russet spot-

ting visible on arrivals. Romaine production from Las Cruces, NM is available for those looking to get excellent quality and

lower their transportation costs. Red leaf, green leaf and boston Demand on Leaf has steadied with moderate supplies

due to cooler temperatures and fair quality leading to lower yields.

Celery

Prices have firmed as supplies have lightened up. This is the time of year when both the Oxnard and Santa Maria districts

start to have issues with seeder. The longer days and warmer temperatures tend to bring on seeder. Because of this

yields will be lighter out of these districts over the next month or so. Prices will continue to escalate as we head into May.

Artichokes

Production has mostly transitioned to the North Coast as the Original and Heirloom varieties have become domi-

nant. Currently heavy to Large sizes before medium and smaller sizes peak next month. Additional supplies of the Thorn-

less variety remain at discounted pricing. Take advantage of these superior edible chokes while in season. Quality

should improve weekly and pricing will continue to follow

Broccoli

There is plenty of product to be had for everyone. Shippers are down and dirty on pricing and looking to move product.

Run your price ideas by us!!

Cauliflower

Pricing continues to decline. There is good availability out of both Santa Maria and Salinas. Overall quality has been

nice. We are seeing nice green jackets with clean white domes.

Brussels Sprouts

Good Demand continues with mostly strong pricing as production declines from Mexico. Limited production from Coastal

California will boost overall supplies and keep pressure on pricing to remain affordable. Insect pressure in Mexico will dic-

tate when their season comes to a close.

Produce West Inc. (800)-538-5826

18911 Portola Drive Suite #D

4/29/22

Green Onions

Mexico supplies have steadied after the Easter Holiday. Quality remains varied with thrip damage causing some discolor-

ation issues on arrival. Border delays remain an intermittent issue and have been magnified with the extra travel day.

Strawberries

Volumes will continue to increase into next week. The largest increases will be coming from the Northern district and San-

ta Maria. The rains we experienced last week did not have a large impact on the plants as many expected. Warm weather

is expected this weekend which should translate to improved quality and larger berries. On the organic front, volumes will

remain stable for the next few weeks before seeing a noticeable increase in numbers the week of May 9th

Blackberries

Good Numbers of Blackberries will continue into next week. Expect supplies out of Central Mexico to begin to decline be-

ginning the 2nd week of May. In California, Oxnard will ramp up production and be the main contributor in late May.

Raspberries

We are peak supplies for this cycle as most of the volume continues to come from Central Mexico and Baja with Oxnard a

distant third. Central Mexico’s numbers will begin to decline significantly as we move deeper into June. Watsonville, Salin-

as and Santa Maria will be underway the 1st week of May.

Blueberries

Florida has only 3 to 4 weeks left in their season. The Baja region is increasing toward its spring production over the next

2 to 3 weeks. Georgia is in peak production and the San Joaquin Valley will begin with light numbers next week.

Stone Fruit

Light harvests over the weekend in the California central valley as a result of recent rains. Harvests resume today on yel-

low peach, white peach and yellow nectarines. Apricots will start packing again by Monday. White Nectarines are forecast-

ed to start in early May and plums are forecasted for the end of May. Sizing will increase slowly as we move through May.

Great flavor reported on all varieties.

Grapes

Lighter supplies of red and green grapes this week. Port delays are resulting in fruit sitting for longer periods of time and

we are seeing a wider range of quality . There are cheap grapes out there but know what you are getting. Shippers are

looking to move fruit that has been sitting for longer periods of time. Cheaper fruit will likely have more issues. With port

delays, there should be offshore fruit arriving on both coasts well into May . The Mexico season will overlap offshore arri-

vals, so at this point we do not expect dramatic market spikes in early May.

Oranges

Navel oranges are still available in limited supply. The season is expected to end around the middle of May for most grow-

ers, some may try to extend out the season into June. Valencia's are now available and early quality reports are good,

with good brix and color reported. Sizing is peaking on 72 and 88 count fruit. Markets will remain strong as the summer

season approaches. Small sizes will continue to be very limited and pricing will be elevated on 113 and smaller fruit.

Produce West Inc. (800)-538-5826

18911 Portola Drive Suite #D

Tim Tomasello

Produce West www.producewest.com

831.455.2981

4/29/22

Lemons

Good supplies and markets remain steady this week. Peak sizing on 115- 140 count fruit. Steading markets will likely con-

tinue through next week. Mostly fancy being packed, many of which are going into choice boxes, resulting in some very

nice fruit overall. We may see a decrease in volume in early May due to transition between districts, and could stronger

markets as a result.

Limes

Good quality overall this week coming out of Mexico. Some isolated reports of blanching, scarring and skin breakdown.

Sizing is peaking on 200 and 230 count fruit. Long range supplies will likely be tight going into the summer and markets

will remain elevated for the near future.

Dry Onions

It seems all roads leading to Texas border crossings have become parking lots for trucks carrying produce from Mexico…

Believe it or not, this backup is causing problems with border crossings in California and Nogales. The Texas market is

being overwhelmed with activity and is sharply higher on all onion categories. This will be short lived, but if you’re a retailer

and have Northwestern onions on your displays, look for sprouting to start any minute. California has started in a very light

way and is not expected to get going until the middle of next week.

Asparagus

Michigan and Indiana were supposed to start in a small way with product being available next week…then it snowed. Indi-

ana says it will have some product next week with 90+ degree temps forecasted for the weekend, but everyone knows the

Midwest will always fool you. Mexico has finished 28/1’s and will be only !1/1’s for the remainder of their deal. California

has product, but is held in few hands and are able to get mid 50’s on their 28/1’s otherwise the low to mid $20’s on 11/2’s.

Cantaloupes

Off shore prices stayed high this week in spite of a bit more product arriving. Sizes are still running very large and quality it

good. Contract demand has continued to take up most of the arrivals. Once again few if any supplies are coming into West

Coast ports. Nogales is starting to pick up and the quality there is good as well, with sizes running mostly regular 9 and 12

count. However demand for Mexico cantaloupes is never robust as retailers shy away given their history of bacterial out-

breaks. Thus prices are dropping in Mexico. Domestic is still not scheduled to start until mid-May with no real volume until

late May. Procurement prospects should improve, especially if you can take Mexican product.

Honeydews

Like cantaloupes honeydew prices recently surged as offshore supplies fell short of contract commitments, leaving the

spot market short of product and driving prices skyward, where they seemed to have leveled off. However Mexico is going

and should be increasing supplies. Sizes in both areas are running musty regular 5s and 6s with some 8s in Mexico and

some jbo 5s offshore. Quality is okay. Demand has yet to change as warm weather has yet to settle in around the coun-

try. Market should remain steady with dealing offshore and lower in Mexico ahead. Domestics will not start until late May.

Produce West Inc. (800)-538-5826

18911 Portola Drive Suite #D

Tim Tomasello

Produce West www.producewest.com

831.455.2981

4/29/22

OG Broccoli & Cauliflower

Cauliflower and Broccoli Northern California production is in full swing. The market has eased with an increasing amount

of deals available depending on location . Hot and Cold temperatures should benefit quality .

OG Celery

Demand and Pricing continue steady with production mostly along the coast. Supplies are expected to be impacted by

seeders through the end of the month. Pricing will be elevated, especially in Salinas as supplies are transferred from

Oxnard until June.

OG Herbs & Bunch Greens

Production has mostly transitioned to Northern California and quality remains varied with overall adequate supplies.

OG Root Vegetables

Carrot Production remains unstable especially Cellos with production areas transitioning . Continue to plan ahead to get full

coverage.

OG Leaf and Iceberg Lettuce

Leaf, Iceberg & Romaine Romaine and Romaine Heart supplies have improved although quality remains mostly fair with

tip burn, russet spotting and rib discoloration expected to continue as temperatures and insect pressure oscillate. Green

and Red leaf . Overall supplies have improved although they remain varied throughout the Valley. Quality continues to

vary as well with sporadic issues with tip burn , russet spotting and continued insect pressure from all Northern California

production areas .

OG Citrus

Lemons, Oranges, Limes and Grapefruit Strong demand throughout the entire Citrus category due to strong retail sales

and revived foodservice activity. The Lemon crop continues with good supplies from the Southern California District as well

as Mexico. Lime quality and supplies remain inconsistent and very limited. Navel production has mostly finished and tran-

sition to Valencia’s will slowly begin to ramp up. Grapefruit supplies should be improving from Mexico and the Cen-

tral Valley through Mid May.

Organic Items

Produce West Inc. (800)-538-5826

18911 Portola Drive Suite #D

BEEF COMMENTARY

The boxed beef market got off to a slow start this week upon exiting the holiday weekend with participants taking a bit longer to assess inventories. Towards the middle of the week, we saw trade begin to pick up and it appeared buyers were in the driver seat as discounts were seen across the primal. It seemed inflation concerns were growing which had swayed buyers clear of taking on larger positions around premium cuts. Buyers have begun to step in for Cinco de Mayo favorites which appeared to offer support to thin meats throughout the week. With that said, these narrow areas of support were unable to sustain the cutout which shed about 1% from the beginning of the week.

GROUND BEEF:

There were no notable changes within the coarse grinds complex as weather conditions have put a damper on turning grills on. It appeared there was some irregularity between packers as supplies varied widely plant to plant.

MARKET OUTFRONT:

The bottom line is this— Markets will be steady to slightly higher across the board. Ten-ders and rib eyes are on the rise and will continue to do so till the second week of May. Round cuts will be steady to down. Grinds will be steady. Thin meats continue to in-crease as expected.

• Grinds will be steady

• The round cuts will be dn. $.10

• The chuck rolls will be dn. $.10

• The market on strips will be steady

• Choice Tenders will be up $.30

• Ribeye’s will be up $ .05

• Beef Sirloin Flap meat will be steady. Choice Peeled skirts will be up $.35. Chuck flap meat will be up $.08.

HAVE A GREAT WEEK!

Don’t expect the huge rise in food prices to slow anytime soon, Bank of America says

Will Daniel

Thu, April 21, 2022, 5:07 PM

Americans are already experiencing some serious sticker shock at grocery stores, but they had better get used to it. The inflation rate for food is expected to continue its historic rise through the end of the year, according to Bank of America.

That’s not exactly surprising considering food inflation saw its largest annual increase in March since 1981—rising at 8.8% year over year—but things may get even worse.

Bank of America analysts, led by Alexander Lin, said in a note on Thursday that they expect U.S. food inflation to hit 9% by the end of 2022.

Rising prices for staples like bread, milk, and meat should continue this year as the price shock from the Russia-Ukraine conflict hits American grocery stores.

“Looking ahead, we think that consumers will continue to feel the pinch of elevated food inflation,” the an-alysts wrote. “While there has been a lot of attention on the shock from the Russia-Ukraine conflict, we believe that it is too early to see the impact at the grocery store…rather, it should lead to sustained price increases later this year.”

Rising costs for farmers mean higher prices at the grocery store

Bank of America’s analysts noted that farmers have been grappling with rising costs like never before. The cost of agricultural chemicals, including fertilizers and pesticides, has jumped almost 50% in the past year alone, March’s producer price index (PPI) showed. And the Russia-Ukraine conflict has on-ly made matters worse.

Russia was the world’s top exporter of fertilizers in 2020, sending nearly $8 billion worth of critical ferti-lizing compounds, including urea and potash, to countries worldwide, according to the Observatory of Economic Complexity.

Fertilizer prices increases have also been exacerbated by higher costs for natural gas, which is critical in the production of nitrogen-based fertilizers. And fertilizers and chemicals represent 10% to 20% of the total costs for U.S. farmers, Bank of America says. That means consumers should expect higher prices for their favorite vegetables and fruits as the year goes on.

But rising fertilizer prices won’t just lead to higher prices in the produce section. The cost of prepared animal feed has rallied 12.7% since last year, according to Bank of America, which should lead to rising prices for meats as well.

“There are signs that companies are passing through higher costs,” the Bank of America team said. “Margins look to be growing on both the wholesale and retail level, suggesting that companies have re-gained pricing power and are comfortable letting the consumer eat higher costs instead of them.”

Busted supply chains, increasing consumption

Rising gas and diesel prices, coupled with labor problems in the trucking industry, are also leading to supply-chain headaches that will only serve to increase food costs for Americans.

The transportation of freight index, which measures the cost of shipping goods in the U.S., jumped an incredible 24.5% year over year in March, largely due to a truck driver shortage that’s been creating problems for suppliers for years.

“The trucking industry was dealing with a shortage of drivers even before the pandemic; now the mar-ket tightened even more dramatically, leading to a surge in trucking costs,” the Bank of America team explained.

On top of that, Americans are now eating more than they have in the past, Bank of America said. Food spending now accounts for 13.5% of U.S. consumers’ spending habits, compared to 13.0% pre-pandemic.

Widespread warnings

Bank of America isn’t the only one warning of rising food costs, either. On Tuesday, U.S. Treasury Sec-retary Janet Yellen said at the U.S. Department of Treasury’s “Tackling Food Insecurity: The Challenge and Call to Action” event that food insecurity will rise alongside food prices.

Yellen said Russia's war on Ukraine has only exacerbated “preexisting price and food supply pres-sures” undermining the U.S.’s economic recovery from the pandemic.

The USDA has also warned that food prices will rise in 2022, but it isn’t as pessimistic as Bank of America. In a March study, USDA researchers concluded that food prices will rise as much as 5.5% this year.

This story was originally featured on Fortune.com

Mission Statement

“Never content to rest on our laurels, we strive to continuously improve and

innovate our products and services. This commitment to excellence has

served our customers well for more than 95 years, and continues to serve as

our standard for success.”

Our Promise

We insist upon top quality products from nationally recognized manufactur-

ers. Our broad inventory consists of more than 64,000 stocked items, from

gourmet to everyday. Never content to rest on our laurels, we strive to contin-

uously improve and innovate our products and services. This commitment to

excellence has served our customers well for more than 90 years, and con-

tinues to serve as our standard for success.

We understand that our customers rely on accurate and prompt deliveries.

Our technological systems ensure that every order reaches customers on

time and in optimal condition. Our state-of-the-art warehousing systems pro-

cess every order with precision. A fleet of modern, temperature-controlled

delivery trucks is equipped with satellite positioning technology to provide

customers with faster, more efficient deliveries. These advances inspire cus-

tomer confidence and satisfaction, which has been our goal since 1925.