TOP STORIES

Beyond Meat Looks to Backyard Grills for Rebound -- Market Talk

0955 ET - Backyard grills may hold the key to plant-based burger maker Beyond Meat's rebound. With a long way to go before lodging and recreation sales return to pre-pandemic levels, Credit Suisse analysts say that to achieve targeted 2Q sales, Beyond will need to heavily promote the new "3.0" version of its burgers and land its products in more grocery store meat cases ahead of the summertime grilling season. Beyond shares are under pressure again early Friday, trading 6% lower after per-share earnings undershot analysts' expectations for the fourth straight quarter, according to FactSet. (jacob.bunge@wsj.com; @jacobbunge)

Labor Shortage a 'Crisis' for Food Distributors -- Market Talk

1109 ET - A shortage of workers is making it hard for food distributors to deliver goods to restaurants reopening their dining rooms in the wake of the pandemic. Steve Grinstead, CEO of distributor Fresh Edge Foods, laid off some 800 employees last year, and said it's tough now to rebuild his workforce as many workers remain on unemployment benefits. Competition for warehouse workers from Amazon.com and other ecommerce companies is also fierce. Short-staffing recently prompted Grinstead to pick orders and load trucks himself during overnight shifts to ensure timely deliveries to customers. "The entire supply chain is in crisis right now because we don't have the people to mount the re-growing of our businesses," he said. (jesse.newman@wsj.com; @jessenewman13)

Elanco Animal Health 1Q EPS, Revenue Top Company's Guidance

Elanco Animal Health Inc. on Friday logged a narrower loss and stronger revenue growth in the first quarter than it had guided investors to expect.

The animal health company reported a loss per share of 12 cents, unchanged on a year earlier and narrower than the loss of 17 cents to 22 cents it forecast in February. On an adjusted basis, it recorded earnings of 37 cents a share, ahead of guidance for 20 cents to 25 cents for the quarter.

STORIES OF INTEREST

Grocers, Restaurants to Suppliers: Hurry Up, Make More

Friction between food retailers and their suppliers is adding costs across the food chain.

Big buyers including Walmart Inc. and Sysco Corp. are fining suppliers over infractions like late or incomplete orders. Retailers excused such penalties for months during the pandemic when surging demand led to widespread shortages.

Ruth's, Shake Shack Note Rising Beef Costs -- Market Talk

09:22 ET - Ruth's Hospitality Group and Shake Shack say in 1Q earnings that beef costs are growing in the chains' current quarters. Steakhouse-chain Ruth's Chris says beef prices are up around 15 to 20% in 2Q compared to last year's quarter. Shake Shack also says beef is pressuring its margins. Ruth's up 5% premarket, Shake Shack off 12%. (heather.haddon@wsj.com; @heatherhaddon)

BellRing Sees Inflation Pressure on 2H Margins and Beyond -- Market Talk

1518 ET - BellRing Brands CFO Paul Rode warned that higher-than-anticipated inflationary pressure, mainly whey and milk proteins, would weigh on gross profit margins. Chief Executive Darcy Horn Davenport said that price increases on shakes and other measures would largely offset commodity and freight inflation in that part of the business. As for the powder business, BellRing is working on mitigating margin pressure from the projected significant increases on whey protein, Davenport said without elaborating. Rode pointed to low single-digit inflation on the milk side, but on whey proteins, the primary ingredient in the company's powders, BellRing is seeing much more significant increases. While that's expected to impact somewhat the fourth-quarter performance, "It's more for as we get into fiscal '22, the inflation on our whey powder business is a concern," he said. (maria.armental@wsj.com; @mjarmental)

FUTURES MARKETS

Lean Hog Futures Slide Even as Cutouts Rise -- Market Talk

1523 ET - Lean hog futures trading on the CME finished down 1.3% to $1.132 per pound. It's the first day that hog futures have traded lower in a week -- this despite pork cutout prices being on the rise today. Midday, the USDA reported that carcass cutout prices rose $3.36 per hundredweight to $117.22 per cwt, while other cutouts across the board rose, with the exception of hams. Pork butt rose $4.10 per cwt as of midday today, while pork bellies rose $22.16 per cwt. Earlier this week, hog futures rose over where cattle futures were trading at -- the first time in over 20 years that's happened. Cattle futures closed up 0.8% to $1.1665 per pound. (kirk.maltais@wsj.com; @kirkmaltais)

CASH MARKETS 


 
Estimated U.S. Pork Packer Margin Index - May 7 
 
All figures are on a per-head basis. 
 
Date     Standard Margin       Estimated margin 
         Operating Index         at vertically - 
                             integrated operations 
 
May  7       -$ 24.70            +$ 98.82 
 
May  6       -$ 26.23            +$ 99.92 
 
May  5       -$ 29.07            +$ 95.58 
 
 
* Based on Iowa State University's latest estimated cost of production. 
A positive number indicates a processing margin above the cost of production of the animals. 
 
Beef-O-Meter 
This report compares the USDA's latest beef carcass composite 
values as a percentage of their respective year-ago prices. 
 
                                  Beef 
          For Today              Choice   68.1 
      (Percent of Year-Ago)      Select   67.2 
 
USDA Boxed Beef, Pork Reports

Wholesale choice-grade beef prices Friday fell 49 cents per hundred pounds, to $305.88, according to the USDA. Select-grade prices rose 91 cents per hundred pounds, to $290.27. The total load count was 64. Wholesale pork prices fell 51 cents, to $111.70 a hundred pounds, based on Omaha, Neb., price quotes.

(END) Dow Jones Newswires

05-07-21 1746ET