[Mon]: The hog market remains in a steep downtrend, and the short-term news flows remains mostly negative, according to The Hightower Report… [Fri]: National Daily Hog and Pork Summary / National carcass base was 5 cents lower… Iowa-Minnesota carcass base was down 50 cents… USDA reported carcass cutout values this afternoon fell 37 cents… Analysts are seeing reasons for optimism in the expectation China will buy more U.S. farm products, including pork. “Pork values are seeing stabilization, but the cash index still trending lower,” Stewart-Peterson said. “China is expected to ramp up purchases of US farm products soon, and pork could be a major target. There are dropping average carcass weights"…
Farm Commodity Newsletter/Iowa Farmer Today
Mon 6/22/2020 8:55 AM
Lean Hogs - The year-to-date pork production is now back above last year by 0.2%, due to heavier average weights per hog that are offsetting lower slaughter, Brugler Marketing said.
The hog market remains in a steep downtrend, and the short-term news flows remains mostly negative, according to The Hightower Report.
Beef may regain some markets
The alternative proteins or plant-based products enjoyed good support during the shortages of meat in supermarkets. As meat prices fall and processing is restored to a more normalized level, beef should re-capture some of the lost markets to these products. It will regain market share because it is a better product at a better price, according to The Cattle Report.
Trade frictions with China could intensify short-term, due to customs issues, which could lead to more meat in the U.S. for U.S. consumers to absorb.
Fri 6/19/2020 5:05 PM
In weighted average negotiated prices for barrows and gilts, USDA reported;
National carcass base was 5 cents lower to $28.48/cwt.
National live was $24.01, with no comparison to the prior day
Iowa-Minnesota carcass base was down 50 cents to $28.07
USDA reported carcass cutout values this afternoon fell 37 cents to $64.64/cwt.
“China's customs authority has asked food exporters to China to sign a declaration that there produce is not contaminated by Novell coronavirus,” the Hightower Report said. “A continued sluggish demand tone, plus fears that hogs are backed up in the country and that near term supply will swell has helped to pressure.”
Analysts are seeing reasons for optimism in the expectation China will buy more U.S. farm products, including pork. “Pork values are seeing stabilization, but the cash index still trending lower,” Stewart-Peterson said. “China is expected to ramp up purchases of US farm products soon, and pork could be a major target. There are dropping average carcass weights."
Choppy day hits cattle
“August cattle experienced choppy and two-sided trade early in the day, but the market closed moderately lower on the day and not far off of the lows,” the Hightower Report said. “Fears that China is increasing restrictions on imports of food helped to pressure the market as this could force beef to compete in an environment where pork and poultry supplies swell.”
“The market opened higher on the session with hopes that China would fulfill its phase 1 trade agreement with the US, and that they would purchase additional pork from the US,” the Hightower Report said. “However fears of new restrictions on food moving to China helped to trigger selling, and the market closed sharply lower on the day.”
Markets quiet going into weekend
“Another quiet day in the markets as the weekend approaches,” Ami Heesch, with CHS Hedging, said. “Soybeans were strong for the week on ideas that US/Chinese tensions were easing slightly, along with hopes that China will continue to honor their Phase One Trade Agreement commitment as they have stated that they would many times.”
Export news from China and Brazil provided some support for soybeans. “News that China and US trade negotiations are continuing, and talk that China will buy more US soybeans helped to support,” the Hightower Report said. “In addition Brazil soybeans for export are priced well above US so traders are hopeful that China buys US soybeans over the near term.”
Corn moved slightly higher on Friday. “The corn market traded slightly higher in thin volume ahead of the weekend,” Ami Heesch, with CHS Hedging, said. “Most months saw a 6-7 cent trading range. Prices drew underlying support from bouts of fund short covering and overall lack of farmer selling.”
“Corn futures edged higher. Some of the buying was linked to optimistic US and China talks that could open the door for China to increase buying of US corn, ethanol and meat,” Steve Freed, with ADM Investor Services, said. “There is also talk that China may soon approve new import quotas that would allow them to buy 5 mmt of US corn.”
Demand helped push soybeans higher. “Soybean prices were stronger on decent demand for US soybeans and spillover strength in the soyoil market,” Ami Heesch, with CHS Hedging, said. “Prices drew additional support from today’s rally in the energy market. Farmers were noted sellers of soybeans in modest volume.”
“Soybean traded higher,” Steve Freed, with ADM Investor Services, said. “World that China may increase buying US soybean offered support… US soybean export prices are cheaper to China than Brazil. US Midwest 7-day weather forecast calls for normal rains and normal temps. Key is July weather with some forecasting a return of above normal temps and below normal rains.”
“The wheat market was mixed with Chicago on the defensive from increases in global supplies, KC weakness from harvest activity and better than expected yields and Mpls drawing strength from this week’s dryness across the Northern Plains and the Canadian Prairies,” Ami Heesch, with CHS Hedging, said.
“Wheat futures traded marginally lower,” Steve Freed, with ADM Investor Services, said. “Increase US winter wheat harvest offered resistance. Talk of slower World demand for wheat imports also weighed on prices. Optimistic trade talks between US and China offered support. Rumors of China interest in US wheat supported US export basis.”