LIVESTOCK HIGHLIGHTS: Top Stories of the Day

Date : 12/13/2019 @ 10:49PM
Source : Dow Jones News

LIVESTOCK HIGHLIGHTS: Top Stories of the Day

TOP STORIES

 
Brazil Meat Packers Will Continue to Benefit from Swine Fever -- Market Talk 

10:33 ET - Brazilian meat packers including JBS, Marfrig and BRF have all risen this year, helped partly by the increase in demand from China because of the outbreak of African swine fever there, according to Betina Roxo, an analyst at XP Investimentos. The effects of the disease, which has decimated China's swine herd, still hasn't been fully priced in to the three Brazilian companies' shares, and will continue to be felt into next year, Roxo says. Strong demand from the US will also boost the three companies' sales, she said. (jeffrey.lewis@wsj.com)

 
Vietnam Pork Prices at Record High Due to Swine Fever -- Market Talk 

0424 GMT (Dec. 12) - Pork prices in Vietnam are at record high as around 22% of the country's pig population has been culled due to African swine fever, the U.S. Department of Agriculture says in a note. "ASF is expected to continue to affect Vietnam's swine sector and the economy at large," the department says. Live hog prices have increased by 35% to 40% since September 2019 and with the approach of the Tet holiday it is uncertain when hog prices will stabilize, USDA says. (lucy.craymer@wsj.com)

 
 

STORIES OF INTEREST

 
Soybean Futures Higher Following Trade Deal Confirmation 

Soybeans for January delivery rose 1% to $9.07 1/2 a bushel on the Chicago Board of Trade on Friday, with the market reacting cautiously to China's confirmation of a trade deal. The market finally got a Phase 1 trade deal between the U.S. and China, but the many-times-bitten grains traders were quite shy about jumping into futures. The Trump administration said China will buy between $40 billion and $50 billion worth of U.S. agricultural products, but traders are skeptical. "They need U.S. pork, they need U.S. soybeans," said Dave Marshall of First Choice Commodities. "Do they need $50 billion of agricultural goods? Absolutely not."

 
Global Food-Delivery Battle Heats Up With $4 Billion Deal 

European food-delivery giant Delivery Hero SE has agreed to buy a South Korean rival for $4 billion, heating up the global battle to meet growing consumer demand for delivered meals. Online food-delivery businesses around the world are joining forces and attracting investment as more consumers opt to have their meals brought to their homes or offices, with Amazon.com Inc. and Uber Technologies Inc. joining the fray in recent years.

 
The Downside of the US-China Trade Deal -- Market Talk 

1506 ET - It isn't clear US farmers have $50B of goods to sell to meet obligations China is supposed to take under the new, limited trade agreement between the US and China, says Robert Daly of the Wilson Center. Previous agricultural sales to China were at just roughly $17B. And forcing China effectively to guarantee more purchases may come at the expense of closer allies who will then get sales shutout of the Chinese market, adds Daly, who runs the Kissinger Institute on China and the United States. "The United States is advocating for managed trade rather than free trade," he said. "We are violating the free-market principles which we are simultaneously asking China to respect." (tim.puko@wsj.com; @timpuko)

 

FUTURES MARKETS

 
Hogs End Off Highs as Trade Enthusiasm Eases Some -- Market Talk 

15:41 ET - Hog futures end up 1.2% at 69.5 cents per pound, off its earlier high of 71.55 cents, as Chinese officials confirm a preliminary trade deal with the US. Live cattle futures had an even better day, rising 2% to $1.2755 per pound. It's the highest cattle futures have been since April, and continuing cattle's rally that began in mid-September. Promises of sizable agriculture purchases by China help sentiment, though details and firm commitments are hard to find. (kirk.maltais@wsj.com; @kirkmaltais)

 

CASH MARKETS

 
Estimated U.S. Pork Packer Margin Index - Dec 13 
 
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 13       +$ 66.01            +$ 41.29 
Dec 12       +$ 66.89            +$ 41.07 
Dec 11       +$ 69.21            +$ 47.27 
 
* 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  101.8 
      (Percent of Year-Ago)     Select  101.6 
 
USDA Boxed Beef, Pork Reports 

Wholesale choice-grade beef prices Friday rose 64 cents per hundred pounds, to $216.29, according to the USDA. Select-grade prices rose $1.68 per hundred pounds, to $204.24. The total load count was 127. Wholesale pork prices rose 10 cents, to $80.94 a hundred pounds, based on Omaha, Neb., price quotes.

 

(END) Dow Jones Newswires

December 13, 2019 17:34 ET (22:34 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.


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