LIVESTOCK HIGHLIGHTS: Top Stories of the Day
Covid-19 Slashes Pork Profits at Smithfield -- Market Talk
16:51 ET - Top US pork supplier Smithfield Foods managed to
generate $102M in 2Q profits despite Covid-19 temporarily closing
some of the company's plants, and adding $350M in costs as the
company paid workers to stay home and bought safety gear for
plants. Smithfield says it earned $102M for the period, less than
half the total a year ago, thanks to risk management
efforts--without those, the company would have lost $72M for the
quarter, after a record-setting 1Q. Smithfield, owned by China's WH
Group, expects results to improve in the fall as Covid-19 costs
decline. (email@example.com; @jacobbunge)
STORIES OF INTEREST
Red Robin Swings to 2Q Loss as Sales Drop Off During
Red Robin Gourmet Burgers Inc. said it lost $56.3 million in its
latest quarter as sales fell and the restaurant chain reworked its
operation due to the pandemic by closing locations and reopening
them with limited seating capacity.
Same-store restaurant revenue for its fiscal second quarter that
ended July 12 dropped 41%, a decline that shows the magnitude of
the fall-off in demand as the pandemic upended the experience of
dining out. Other restaurant chains have reported similar drops in
Wheat Rises Ahead of WASDE Report
Wheat for September delivery rose 0.8% to $4.95 a bushel on the
Chicago Board of Trade Tuesday, in reaction to Egypt buying a new
tender of Russian wheat and ahead of Wednesday's WASDE report from
Corn for December delivery rose 0.2% to $3.23 1/2 a bushel.
Soybeans for November delivery rose 0.1% to $8.73 1/2 a
Wind Damage to Corn Crop Unclear -- Market Talk
13:11 ET - Hurricane-force winds affecting crop-growing areas
from Ohio to South Dakota have likely made a sizable effect on
crops grown in the Midwest--specifically corn, which is more likely
to suffer from being broken in the winds than other crops like
soybeans. However, how large an effect the winds have had on what
would otherwise be an ample 2020 corn crop remains to be seen. "The
question is how much of an impact, which is very hard to assess at
this point," Scott Irwin of the University of Illinois says.
Currently, Irwin estimates the storm has shaved off 100M-300M
bushels of corn production in the US in 2020--a pittance when
compared to the 15B bushels expected to be produced in 2020.
Cattle Futures Rise as Demand Improves -- Market Talk
15:16 ET - Live cattle futures on the CME rose by 1.1% to $1.083
per pound. It's the highest close for cattle futures since early
March, and is in reaction to higher demand for beef among US
consumers. Particularly, normally higher demand for beef ahead of
Labor Day in September is being amplified in reaction to consumers
opting to stay home to avoid coronavirus risks. "Pent up demand due
to COVID restrictions and lack of dining out options in a number of
areas will likely induce consumers to do more home grilling and
socializing," says Steiner Consulting. Hog futures, meanwhile,
finished trading down 3.7% to 51.825 cents per pound, giving back
much of yesterday's 5.6% gain. (firstname.lastname@example.org;
Estimated U.S. Pork Packer Margin Index - Aug 11
This report reflects U.S. pork packer processing margins. The margin indices
are calculated using current cash hog or carcass values and wholesale pork
cutout values and may not reflect actual margins at the plants. These
estimates reflect the general health of the industry and are not meant to
be indicative of any particular company or plant.
Source: USDA, based on Wall Street Journal calculations
All figures are on a per-head basis.
Date Standard Margin Estimated margin
Operating Index at vertically -
Aug 11 +$ 65.15 +$ 17.27
Aug 10 +$ 62.93 +$ 17.42
Aug 7 +$ 66.54 +$ 20.82
* 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.
This report compares the USDA's latest beef carcass composite
values as a percentage of their respective year-ago prices.
For Today Choice 95.2
(Percent of Year-Ago) Select 98.6
USDA Boxed Beef, Pork Reports
Wholesale choice-grade beef prices Tuesday rose 88 cents per
hundred pounds, to $208.08, according to the USDA. Select-grade
prices rose $1.09 per hundred pounds, to $195.02. The total load
count was 156. Wholesale pork prices fell 7 cents, to $69.77 a
hundred pounds, based on Omaha, Neb., price quotes.
(END) Dow Jones Newswires
August 11, 2020 17:32 ET (21:32 GMT)
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