On-premise beer sales (BUD)
On-premise beer sales velocity increased 4.1% for the weekend of March 24-27 compared to two weekends prior according to BeerBoard. Compared to the same weekend a year ago on-premise sales velocity increased 3.7% nationally. The volume of beer sold on-premise nationally increased 4.2% for the weekend of March 24-27 compared to two weekends earlier and 6.4% for the same weekend in the prior year. Beer volumes increased 118.5% on St. Patrick’s Day (Thursday vs. Wednesday).
Return to the office (ACI)
According to Kastle Office Systems, the average office occupancy rate of its top ten cities in the U.S. was 40.0% for the week ended March 23, up 40bps from the prior week. Door swipes improved sequentially in six of the ten cities.
The Texas cities have had the highest occupancy rates in the top ten tracked by Kastle for much of the pandemic. Texas has had no indoor restrictions for longer than most states, but the occupancy rates have not increased much beyond 50%. The Texas cities’ occupancy rate points to what the new normal could be for the rest of the country, a far cry from 95% pre-pandemic.
Another spike in beef prices? (TSN)
The USDA Cattle on Feed report showed feedlot inventory of 12.163 million head of cattle on March 1. Inventory was up 1.4% from a year ago to a record level for the month of March dating back to 1996. The March inventory was down slightly from 12.199 million in February which was a record for any month dating back to 1996. Feedlot placements in February were up 9.3% YOY, boosted by dry winter grazing conditions. Feedlot marketings increased 4.9%, the largest for the month of February since 2000. February’s slaughter was up 4.6% and beef production was up 6.9%. February’s placements likely brought forward from March. Drought conditions and higher feed costs are creating a difficult environment for ranchers resulting in higher slaughter. Higher cattle prices are needed to grow the herd size which would necessitate higher heifer retention by the end of the year. The increase in beef prices has primarily benefited the packers, not the ranchers. At some point, cattle prices will need to rise to offset the higher costs. What will the impact be to packer margins and prices at retail?
