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November 27, 2008

                           
US Retail Meat: Grocers prepare for quick transition
                 

 

Grocers are preparing for a quick transition from their Thanksgiving promotions back to featuring mainly beef and pork in the week after the holiday, and most stores will make the change over by Friday (November 28) morning for weekend specials.

 

There is little rest for the meat departments because once the holiday is over, space that had been devoted to turkeys and other products sold mainly at Thanksgiving time must be cleaned out and used for other items.

 

Grocers don't mind carrying over a few turkeys into December because the stores normally sell a fair number of them during the Christmas-New Year's period, analysts said. The birds they hope not to have many left are the large Toms, since shoppers seem to prefer the smaller hens for the December holidays.

 

Some supermarket chains have sent out newspaper inserts for weekend or five-day promotions that will run from Friday through next Tuesday. Several of these grocers are featuring bone-in steaks in larger family-pack size trays at attractive per-pound prices to pull in more customers. Regular hamburger, along with some ground chuck and round products, also are included. There are a few roasts as well, but analysts said grocers may push the roasts more around the middle of the month.

 

Retail meat buyers have been reluctant to book large quantities of beef this week while weighing their options on other proteins. Bruce Longo, market analyst with Urner Barry's Yellow Sheet in his midday market comments said "buyers for the most part appear content to wait till after the Thanksgiving celebration to commit to other than fill-in orders."

 

The US Department of Agriculture's beef carcass composite values have declined for five consecutive days through Wednesday. Choice beef prices fell US$5.83 during the five-day slide, while select was down US$5.84.

 

In the pork category, bone-in centre cut and assorted chops were among the most featured items for the short period between Thanksgiving and the beginning of the first of the weekly promotions in December.

 

Analysts and meat distributors said retailers want to hold down the per-pound price points at this time because it is the end of the month and most shoppers have just spent a good amount of money purchasing items for their Thanksgiving feasts, so their food budgets are likely tightened. The bone-in products are generally cheaper than the boneless alternatives, and shoppers tend to respond to the per-pound price or the cost per serving that can be prepared from that product.

 

Several grocers also included two or more chicken cuts or whole birds in the weekend specials or short-period ads at attractive price points. This generally resulted in more split bone-in breasts than normal.

 

Analysts predict that grocery chains will feature more of the boneless/skinless chicken breasts next week and possibly again near the middle of the month because wholesale prices have been attractive and shoppers may be looking for better bargains on food items during the gift-buying season. The US Department of Agriculture reported wholesale prices for the boneless breasts on a delivered basis into the northeast US at US$1.15 to US$1.20 a pound, up 10 cents from a week ago.

 

Processors have been pulling back on egg sets more sharply in recent weeks, which is also helping to support prices. The USDA's weekly reports for egg sets show an average decline of 9 percent in the latest month.

 

The average price of the 15 cuts of beef in the Dow Jones Newswires survey this week was US$3.98 a pound, compared with US$3.86 a week ago and US$3.95 a year earlier. The 13 cuts of pork in the survey averaged US$2.47 a pound, versus US$2.63 a week ago and US$2.17 a year ago. The four cuts of chicken had an average price of US$1.46 a pound, compared with US$1.53 a week ago and US$1.44 a year ago.
                                           

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