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Brazil Inflation Accelerated in November as Demand From China Pushed Beef Prices Higher

SAO PAULO--Brazil's consumer prices rose in November as the price of food increased amid strong demand in China for Brazilian beef.

Consumer prices rose 0.51% in November and increased 3.27% from a year earlier, the Brazilian Institute of Geography and Statistics, or IBGE, said Friday. In October prices rose 0.1% in the month and advanced 2.54% from a year earlier.

The pace of food price increases should continue to pick up in December amid a seasonal increase in demand. The outbreak of African swine fever that has decimated China's pork supplies should mean continued strong demand for beef imports from Brazil, adding further pressure to prices in the South American country.

Zambeef Expects 2019 Earnings Rise But Hit by Currency Weakness

Zambeef Products PLC (ZAMBEEF.ZM) said Friday that the board expects to report rising revenue and earnings for fiscal 2019 in local currency, but a fall in dollar terms due to difficult macroeconomic conditions.

The London-listed, Zambia-based meat and dairy producer said that for the year ended Sept. 30 it expects revenue to be $254.5 million compared with $280.3 million in fiscal 2018. In local currency, it expects revenue to rise 11%.

STORIES OF INTEREST

Trump Official Says 'No Arbitrary Deadlines' for China Trade Deal

WASHINGTON -- President Trump's top economic adviser said Friday that there are "no arbitrary deadlines" for completing a limited trade deal with China ahead of a new set of tariffs planned for this month.

"These are presidential decisions," White House economic adviser Larry Kudlow said Friday on CNBC. "But, the fact remains that [Dec. 15] is a very important date, with respect to a no-go or a go on tariffs."

Waived Chinese Soybean, Pork Tariffs to Fuel Grains Trading -- Market Talk

09:10 ET - Reports that Chinese officials will waive import tariffs on some soybeans and pork shipments from the US is a positive for US traders, who hope this means that a trade deal is near. Reuters reports that Chinese officials say that they will waive import tariffs on some soybeans and pork shipments from the US, though it remains unclear as to which products these waived tariffs will apply. Without a deal, new tariffs between the two sides are expected to go into effect on Dec. 15. Overnight, soybeans on the CBOT rose 0.8%. (kirk.maltais@wsj.com; @kirkmaltais)

FUTURES MARKETS

Hogs Lose China Waiver Momentum and Close Lower -- Market Talk

15:36 ET - Lean hog futures on the CME finished down less than 0.1%, at 67.55 cents per pound, erasing earlier gains. Hogs started trading up over 2% this morning in reaction to reports that China may grant waivers on certain imports of US soybeans and pork. However, with little to no clarity as to what imports would qualify, livestock traders soon lost enthusiasm for lean hogs. "As always, 'the Devil is in the details': what quantity of imports will be allowed?" AgResource says. Meanwhile, live cattle futures finished up 0.3% to $1.24975 per pound. (kirk.maltais@wsj.com; @kirkmaltais)

Food-Delivery Companies Serve Poor ESG Performance: Citi -- Market Talk

1655 GMT - Food-delivery companies are serving up some of the poorest environmental, social and governance records in the leisure sector, reflecting the ongoing debate on workers' rights, Citi says. "We expect ESG factors to be increasingly in focus over coming years, as scrutiny increases on the gig economy model," Citi says. The bank says a "profitable food-delivery model could be incompatible in many countries with riders as full-time company employees" but delivery companies will face less ESG risks and regulatory changes in emerging markets. (dieter.holger@wsj.com; @dieterholger)

CASH MARKETS

 
Estimated U.S. Pork Packer Margin Index - Dec 6 
 
Source: USDA, based on Wall Street Journal calculations 
All figures are on a per-head basis. 
 
Date     Standard Margin       Estimated margin 
         Operating Index         at vertically - 
                             integrated operations 
Dec  6       +$ 71.32            +$ 45.21 
Dec  5       +$ 68.80            +$ 44.03 
Dec  4       +$ 67.85            +$ 41.55 
Dec  3       +$ 69.90            +$ 42.15 
 
* 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  105.6 
      (Percent of Year-Ago)     Select  104.6 
 
USDA Boxed Beef, Pork Reports 

Wholesale choice-grade beef prices Friday fell $1.04 per hundred pounds, to $224.56, according to the USDA. Select-grade prices fell 82 cents per hundred pounds, to $207.30. The total load count was 132. Wholesale pork prices rose 55 cents, to $81.43 a hundred pounds, based on Omaha, Neb., price quotes.

(END) Dow Jones Newswires

December 06, 2019 17:16 ET (22:16 GMT)

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