Commodity forecasting highlights from CommodityONE
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Poultry
Chicken supplies remain tight as producers continue to keep output in check. Young bird slaughter was 4% below the same week last year, and while year-to-date chicken production is still up 1.7%, the pipeline ahead looks only modestly larger, with broiler egg sets up 0.4% and chick placements up 0.5%. That slower production is already supporting pricing, especially for leg quarters and thighs, while demand remains strong: per capita chicken consumption is projected at 106.8 pounds, up 3.8% from 2025 and a record. Chicken also continues to benefit from being a much more affordable protein than beef.
Outlook: Chicken demand should stay solid and tighter-than-expected production is likely to keep the market supported in the near term.
Beef
Beef production remains constrained, with last week’s output down 4.5% year over year as cattle slaughter fell 5.4%. Feedlot placements were especially light, down 9% from 2025 and the smallest August placement total in 30 years, reinforcing the longer-term tight supply story. Still, there may be some short-term relief: projections show Q4 beef supplies rising by 295 million pounds from Q3, the largest seasonal increase in more than a decade. At the same time, beef trim markets dropped sharply, and the USDA now expects 2026 beef production at 24.9 million pounds, down 4.3% from last year and the smallest since 2016.
Outlook: Beef supplies are still historically tight overall, but a bigger seasonal Q4 production bump could pressure prices modestly in the coming months.
Pork
Pork production last week was down 4.8% from a year ago, driven by a 3.9% decline in hog slaughter, and year-to-date production is essentially flat to slightly lower at 0.1% below 2025. Despite the lighter output, prices weakened, with the USDA pork cutout falling to its lowest level since February 2024. The sharpest move came in bellies, which dropped 25% in one week and are now down 46% year over year, reflecting soft demand. Looking ahead, the market expects USDA’s upcoming Hog and Pigs report to show a smaller herd, with June forecasts already pointing to sow farrowings down nearly 2% from last year.
Outlook: Pork may stay under pressure near term due to sluggish demand, but tighter herd numbers could lay the groundwork for firmer pricing into 2027.
Produce
Produce markets were relatively calm overall, but a few items are worth watching. 48-count Hass avocados continued to ease and are approaching their current year-to-date low, with support expected before they fall below $20 per carton. 24-count iceberg lettuce moved higher again and appears to have meaningful upside into late fall, while 25-pound large Roma tomatoes are also starting to firm. Even so, Roma prices are expected to top out closer to $30 in November, well below the $40+ levels seen earlier this spring.
Outlook: Avocados should remain fairly stable, while lettuce and tomatoes have room to move higher seasonally through late fall.
Dairy
Dairy trading stayed active, with 49 loads changing hands on Friday’s CME spot session. For the week, cheese blocks, barrels, and butter moved lower, while nonfat dry milk and dry whey held steady. Cream availability remains ample, supporting strong butter production, and U.S. butter prices are trading at a discount to global markets, which could help exports. The bigger issue is producer economics: rising feed costs and weaker cheese and butter prices are tightening dairy farmer margins, which could eventually reduce the milk cow herd and tighten supply later on.
Outlook: Dairy markets look mostly rangebound for now, but worsening farm margins could become a bullish supply story later this fall or winter.
Grains
Grain markets were mostly quiet outside of soybean meal. December corn has settled into a $5.20 to $5.40 range following the latest crop report, which pushed the 2026/27 U.S. stocks-to-use ratio below 10%, a level that is historically considered tight. Even so, some demand concerns are emerging, especially in exports and domestic use, and that could trigger a near-term pullback. The longer-term balance sheet still looks relatively supportive, particularly with global supplies also tight.
Outlook: Corn could correct lower in the next few weeks, but the market still looks capable of holding around $5 longer term.
Seafood
Tilapia continues to rebound sharply from its spring lows. In the July seafood import data, frozen tilapia filet prices rose 6.7% month over month, after posting a similar increase in June. Prices had fallen to an all-time low in May—with the data series going back to 2012—but lower-than-usual import volumes in recent months have helped fuel the recovery. Even so, the second half of the year is typically quieter for tilapia, so this pace of gains may not last much longer.
Outlook: Tilapia prices likely flatten out through the rest of 2026 and early 2027 before a more typical seasonal rally reappears in March.
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