We assume that the cash cattle market will remain in slow gear Tuesday but are still puzzled a bit by last week's early jump start. Yet it seems like a safe bet that feedlot managers will at least pause a day or so to see if the board can stabilize, perhaps expanding the bounce seen late last week. Furthermore, such evidence will no doubt play a big role in how new showlists will be priced. Live and feeder futures seem likely to open some higher thanks to follow-through buying, short-covering and cash premiums.
Look for the cash hog trade to open with bids steady to $1 higher. Seasonally, numbers should continue to tighten from the large fourth quarter offering. Yet adverse winter weather over the last several weeks makes it somewhat difficult to assess currentness, and the true measure of the early-week offering. That said, early estimates of the weekly hog slaughter are calling for a significant drop from last week, probably totaling close to 2.4 million head. Lean futures should open moderately higher, supported by residual buying interest and appreciating carcass value.
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| 1) |
New showlists appear to be generally smaller (especially in Nebraska) with only Kansas offering more ready steers and heifers.
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Beef cutouts sputtered further on Friday, further suggesting that the traditional post-holiday rally is pretty much spent.
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| 2) |
Cattle futures are now technically oversold and clearly due for at least a short-term bounce (perhaps encouraged by the stability of cash premiums). Furthermore, with the index officially completed, some selling pressure should be taken off spot Feb live.
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For the week ending Jan. 9, noncommercials net-long position in live cattle futures declined by 5,200 to a total of 88,300 contracts, mostly due to further additions to the short side
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The pork carcass value closed solidly higher on Friday, supported by better demand for bellies, hams and ribs.
| 3) | Not only is Canada taking the U.S. to the WTO for breaking international trade rules, Mexico has threatened to leave NAFTA negotiations if Trump triggers a preemptive withdrawal. The Northern American family reunion talks sound more like the Hatfields and McCoys than the Waltons. |
| 4) |
For the week ending Jan. 9, noncommercial traders increased their net-long position in lean hog futures by 6,400 contracts, boosting the total to 54,800.
| 4) |
Tough winter weather has the disrupted normal flow of hogs since the first of the year and may continue through much of the week ahead. Yet market hog numbers look generally adequate. Have we backed up barrows and gilts that will necessitate a larger kill once temperatures moderate?
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CATTLE:(thecattlesite.com) -- Korea's US beef imports surpassed the $1 billion mark for the first time ever in the first 11 months of 2017, official government data showed Sunday, fueled by rising consumer demand.
According to the Korea Customs Service (KCS), beef imports hit an annual record of $1.09 billion in the January-November period. This compared to $966.9 million worth of US beef imported in 2016, and is the highest since 2000 when the country started to keep records of imported beef.
Figures for December are expected Tuesday (Monday, 15 January), reports Korea JoongAng Daily.
In term of volume, the customs office said Asia's fourth-largest economy brought in 166,432 tons of American beef in the first 11 months of 2017, exceeding the 156,078 tons imported for the whole of the previous year.
US beef had maintained No. 1 status after the country fully opened its market to imports in 2001. But sales fell sharply after a mad cow disease outbreak in 2003 that caused Seoul to ban imports altogether. Restrictions were lifted after long negotiations in 2008 when the country opened itself to buying beef from cattle under 30 months old.
Afterwards, with the signing of a bilateral free trade agreement and rising demand for US beef, import volume has steadily picked up and returned to levels prior to the mad cow disease scare.
In particular, imports of cold-stored beef, which fetch high prices compared to frozen meat, increased noticeably despite a more complicated distribution process.
Through November, such beef imports surged 81 per cent on-year to 39,799 tons, worth $358.4 million, an increase of 85.6 per cent compared to the previous year.
A representative for the US Meat Export Federation, who handles public relations for the American beef and pork industries, said there has been a rise in demand among ordinary household, as well as restaurants.
"There is growing number of South Koreans enjoying steak that is fueling growth for US beef," he said.
The official predicted there will be steady growth for cold-stored US beef going forward.
KCS, meanwhile, said Korea's total beef imports from all countries in the 11 months of last year moved up 3.5 per cent to 358,984 tons. If numbers for December are added, the total easily topped 366,390 tons imported in 2016.
HOGS: (porkmagazine.com) -- The U.S. Department of Agriculture finalized a regulation late last week that will allow all Mexican states to export pork to the U.S., reports the National Pork Producers Council (NPPC). The group supports the new regulation.
USDA's Animal and Plant Health Inspection Service (APHIS) is implementing a science-based risk assessment that determined Mexico is free of Classical Swine Fever (CSF), a news release from NPPC states. Classical Swine Fever is a highly contagious viral disease in pigs, which was eradicated from the U.S. in the late 1970s. APHIS in 2016 concluded that the risk of CSF from pork imports from Mexico is negligible, NPPC reports.
"The U.S. pork industry is a strong supporter of free trade and of using epidemiological science and risk analyses to determine if trade can be safely conducted between countries," said NPPC President Ken Maschhoff, a pork producer from Carlyle, Ill. said in the news release. "Mexico in 2017 was our No. 2 export market, so maintaining our good relationship with that country by ensuring fair and reciprocal trade is paramount for our producers." Through November last year, approximately $1.4 billion of pork was exported to Mexico from the U.S.
According to NPPC, Mexico in late 2007 requested market access to the U.S. for pork from the eight states in its central region but later amended that request to include all Mexican states. APHIS at that time conducted multiple reviews and "determined Mexico's control program for CSF was not sufficient to classify the country as negligible risk for the disease."
Through a Globall Based Initiative, USDA's Foreign Agriculture Service provided funding to assist Mexico with improving its control program. Through the grant, "Mexican officials received training in foreign animal disease diagnostics at USDA's Plum Island Animal Disease Center and in-country training on case management and control activities," NPPC said in the news report. It said a subsequent review by the World Organization for Animal Health (OIE) determined that Mexico was free of CSF.
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