TOP STORIES

 

Suppliers Fill Their Freezers with Pork -- Market Talk

15:16 ET - Pork supplies are growing. The USDA says that stocks of pork in commercial freezers rose to 614.9M pounds in February, up 6% from the previous month and 8% from a year earlier. Stocks of frozen pork bellies, used to make bacon, rose 188% from the same time last year. Meatpackers are butchering more hogs than ever after constructing new slaughterhouses and expanding capacity. While demand for pork has generally been strong, it hasn't entirely offset growing supplies. Physical hog and pork prices have recently been under pressure as a result. Frozen beef stocks fell from the previous month and a year earlier. (benjamin.parkin@wsj.com; @b_parkyn)

 

Senate Bill Seeks Farm Bill Conservation Reforms -- Market Talk

14:20 ET - Let the Farm Bill jousting begin. Lawmakers have yet to unveil a draft of the nation's main legislation governing agriculture and nutrition policy, but efforts have already begun to reform one of its key conservation programs. Senators Cory Booker (D-NJ) and Mike Lee (R-UT) are out with a bill they say would improve a program that funds farmers who adopt environmentally friendly practices. Analysis of the current program shows that between 2009 and 2016, more than $1B, or over 20% of funds, went to practices that had little environmental benefit. The bill comes amid growing concerns over water quality and soil health in the US Farm Belt, and would direct more monies to small farmers. (jesse.newman@wsj.com; @jessenewman13)

 

STORIES OF INTEREST

 

Darden Tops Earnings Estimates, Raises Guidance -- Earnings Review

Darden Restaurants Inc. (DRI) reported its third-quarter earnings Thursday. Here is what you need to know:

REVENUE: Revenue increased 13.3% to $2.13 billion, with 11.3% growth coming from 154 new Cheddar's Scratch Kitchen restaurants and 34 other net new restaurants. That was just under the $2.14 billion in revenue analysts expected.

EARNINGS: The owner of Olive Garden and Capital Grille reported net income from continuing operations of $218.5 million. On an adjusted basis, which excludes debt retirement costs, impacts of the new U.S. tax law and Cheddar's integration expenses, the company earned $1.71 a share. Analysts polled by Thomson Reuters had expected adjusted earnings of $1.64 a share.

 

Can Big Food Convince Grocers To Raise Prices? -- Market Talk

16:41 ET - Wall Street analysts say the big question for food makers like General Mills and Conagra Brands will be whether they can get grocery stores on board with price increases to offset higher costs for ingredients and shipping. General Mills and Conagra both told investors this week that their profitability was hurt in the latest quarter because of these costs, and that they plan to raise some prices. However, big retailers like Kroger want to keep prices low. Raising prices may have been easier in the past, when sales trends "were not as anemic as today and retailers were under less pressure from online players and deep discounters," said Barclays analyst Andrew Lazar. "But, in our view, pricing has never been easy," he added. (annie.gasparro@wsj.com)

 

FUTURES MARKETS

 

Hog Futures Fall to Multimonth Low

Hog futures tumbled to the lowest point in four months on Thursday.

Prices for wholesale pork and physical pigs have fallen recently as growing supplies of slaughter-ready hogs offset otherwise solid demand, both domestically and abroad. Meatpackers built new slaughterhouses in recent months and added extra capacity, allowing them to kill swine at a record pace.

April-dated lean hog futures fell 2% to 61.325 cents a pound at the Chicago Mercantile Exchange. Hog contracts for May fell 3.1%.

 

CASH MARKETS

 
Zumbrota, Minn Hog Steady At $36.00 - Mar 22 
 
  Barrow and gilt prices at the Zumbrota, Minn., livestock market are 
steady at $36.00 per hundredweight. 
 
  Sow prices are steady. Sows weighing 400-450 pounds are at 
$32.00-$34.00, 450-500 pounds are $32.00-$34.00 and those over 500 pounds 
are $36.00-$38.00. 
 
The day's total run is estimated at 150 head. 
 
Prices are provided by the Central Livestock Association. 
 
 
Estimated U.S. Pork Packer Margin Index - Mar 22 
 
All figures are on a per-head basis. 
 
Date     Standard Margin       Estimated margin 
         Operating Index         at vertically - 
                             integrated operations 
                                      * 
Mar 22       +$29.63             +$ 20.87 
Mar 21       +$28.96             +$ 22.83 
Mar 20       +$29.13             +$ 24.35 
 
* 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  101.3 
      (Percent of Year-Ago)     Select  101.0 
 
USDA Boxed Beef, Pork Reports 

Wholesale choice-grade beef prices Thursday rose 83 cents per hundred pounds, to $225.21, according to the USDA. Select-grade prices rose $1.63 per hundred pounds, to $218.02. The total load count was 114. Wholesale pork prices fell 91 cents, to $70.11 a hundred pounds, based on Omaha, Neb., price quotes.

 

(END) Dow Jones Newswires

March 22, 2018 17:23 ET (21:23 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.