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Reports US

US stock market daily report (July 25, 2014, Friday)

July 28, 2014, Monday, 05:03 GMT | 00:03 EST | 08:33 IST | 11:03 SGT
Contributed by Millennium Traders

The U.S. Department of Agriculture said on Friday that drought conditions in California as well as other states could drive prices even higher for fresh produce and beef. During 2014, 7 million piglets died from a virus resulting in a forecasted increase for pork prices of nearly 11%, by the USDA. For 2014 the USDA is forecasting an increase by 9% for wholesale beef prices although, rising imports are helping to offset some of the decline in domestic supplies. Additionally, the agency is forecasting an increase in seafood prices for the year.

USDA said, "It appears that supermarkets are maintaining minimal price inflation on packaged food products, possibly in an effort to keep prices competitive in light of rising cost pressures for most perishable items."

Vegetable prices are seen rising throughout the year, potentially as a result of the drought in California - the largest U.S. grower of fruits and vegetables. USDA said, "The ongoing drought in California could potentially have large and lasting effects on fruit, vegetable, dairy and egg prices, and drought conditions in Texas and Oklahoma could drive beef prices up even further."

Year to date up to June 2014 - fresh fruit prices have risen 5.8% compared to same period of 2013 however, during the month of June prices fell 4.1%, reflecting a decline in citrus prices and a seasonal shift toward summer fruits.

USDA forecasts U.S. fish and seafood prices to increase by 4.5% for 2014. In June 2014, forecast was only for a 3.5% increase. "In general, fish and seafood prices have been climbing due to decreased supplies of certain species and increased consumer demand, as other meats have become more expensive," the USDA said.

The National Oceanic and Atmospheric Administration's weekly drought monitor indicates much of California in an extreme or exceptional drought - the two most severe categories. Pockets in Texas are in exceptional drought as well.