TOP STORIES

Analysts Expect Decline in Beef Cow Herd -- Market Talk

12:15 ET - The US beef cattle herd is expected to decline in the USDA's upcoming bi-annual cattle inventory report, according to multiple agriculture research firms. The biannual report is expected to show supply of beef cows falling nearly 1% to over 31M head--which would be the first time in six years that the beef cow herd has shrunk, according to Allendale. Live cattle futures are down 0.4% in trading, bringing the price to below $1.21 per pound. (kirk.maltais@wsj.com; @kirkmaltais)

STORIES OF INTEREST

McDonald's Looks to Step Up Chicken Offerings at Breakfast

McDonald's Corp. will pilot breakfast chicken sandwiches, a move that comes as the fast-food chain faces intense competition at the start of the day and looks to upgrade offerings for a key protein.

The company said Tuesday it will offer chicken served on griddle cakes and on biscuits for a limited time. Restaurant chains often use such special offers and deals to try to get customers into locations and spark new sales.

USMCA Signing Expected to Have Little Effect on Grains -- Market Talk

11:00 ET - The US-Mexico-Canada Agreement, otherwise known as the USMCA, is expected to be signed into law by President Trump tomorrow, according to several reports. The signing ceremony comes after the Senate voted in favor of the deal on Jan. 16, voting 89-10 to pass the bill. The signing will likely not have much effect on CBOT grain futures, says John Payne on Daniels Trading. "In reality, Mexico has been buying a lot of US ag products this entire time," says Payne. "Outside of a sharp move in the peso or looney, I don't think their market position will change much." According to Payne, the bigger risk to US commodities is when Asian markets reopen next week--which could inflict significant pressure on other commodities. (kirk.maltais@wsj.com; @kirkmaltais)

Wheat Prices Have Risen Too Far Above Corn -- Market Talk

1437 GMT - Wheat prices are slightly lower in Paris and Chicago, having outperformed other agricultural commodities so far this year. "Even though the market has been tight, the advance has been overdone," says Nicolas Robin, who manages commodity investments at Columbia Threadneedle. Wheat prices have risen too far above corn prices, Robin says, encouraging farmers to feed their animals with corn instead of wheat. Elsewhere in agricultural and soft-commodity markets, Robin is betting on higher soybean prices, and thinks U.S. pork prices will rise in response to larger purchases from China. "We like the lean-hog market right now," he says, adding that Chinese import demand is likely to rise once the trade deal with the U.S. starts to kick in. (joe.wallace@wsj.com)

FUTURES MARKETS

Livestock Futures Finish With Mixed Results -- Market Talk

15:30 ET - Cattle futures sink while hog futures make up some ground after yesterday's limit-down close. Live cattle futures on the CME drop 0.5% to $1.207 per pound, while lean hog futures rise 1.2% to 71.3 cents per pound. Hog futures are down 8.5% since the start of the year. (kirk.maltais@wsj.com; @kirkmaltais)

CASH MARKETS

 
Estimated U.S. Pork Packer Margin Index - Jan 28 
 
 This report reflects U.S. pork packer processing margins. The margin indices 
are calculated using current cash hog or carcass values and wholesale pork 
cutout values and may not reflect actual margins at the plants. These 
estimates reflect the general health of the industry and are not meant to 
be indicative of any particular company or plant. 
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 
 
Jan 28       +$ 36.89            +$ 28.62 
Jan 27       +$ 42.42            +$ 31.87 
Jan 24       +$ 44.14            +$ 31.70 
 
* 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   97.9 
      (Percent of Year-Ago)     Select  100.3 
 
USDA Boxed Beef, Pork Reports 

Wholesale choice-grade beef prices Tuesday fell 74 cents per hundred pounds, to $212.85, according to the USDA. Select-grade prices rose $1.66 per hundred pounds, to $212.16. The total load count was 153. Wholesale pork prices fell $1.51, to $75.05 a hundred pounds, based on Omaha, Neb., price quotes.

(END) Dow Jones Newswires

January 28, 2020 17:27 ET (22:27 GMT)

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