Packer inquiry in cattle country could start to improve at midweek. But if the board remains relatively stable/firm, our guess is that feedlot managers will dig in with higher asking prices (e.g., $122-123 in the South; $195-plus in the North) until Thursday or Friday. Live and feeder futures should open significantly lower, checked by faltering carcass value and uncertain cash potential.
Look for the cash hog trade to open this morning with steady/firm bids. While packers bids were little better than steady on Tuesday, country movement definitely seemed on the slow side. Buyers may be forced to show more money in order to fund slaughter plans through the week. This week's kill will of course be smaller thanks to the observation by some plants of MLK. Additionally, processing margins have certanly narrowed this month as the cost of live inventory has raced ahead of carcass value. Still, weekly hog slaughter should still be close to 2.4 million head. Lean hog futures are set to open at least moderately higher, bolsted by residuals; buying interest and technical support.
| BULL SIDE | BEAR SIDE | ||
| 1) |
Cattle futures scored decent progress on Tuesday, perhaps moving to confirm last week's low as a meaningful bottom. If the board can continue to climb toward recent feedlot sales, the softening basis could lend feedlot managers more resolve.
| 1) |
Beef cut-outs imploded on Tuesday with the choice and select box each losing more than $2. Furthermore, box supplies were described as "moderate to heavy"
|
| 2) |
According to the latest cmprehensive boxed beef report, out front sales (with delivery of 22 days or more) jumped to 1,094 loads. Such business suggest greater demand confidence moving toward the middle of the first quarter.
| 2) | There's little reason to believe that yesterday's rally in cattle futures was more than a dead cat bounce. Live and feeder contracts remain significantly checked by multo levels of overhead resistance. |
| 3) |
Lean hog contracts exploded with triple-digit gains yesterday. Settling near over above 10-day moving highs, summer issues will open this morning within striking distance of new contract highs.
| 3) | The pork carcass value closed moderately lower on Tuesday, pressured by softer demand for butts and picnics. |
| 4) |
Hog weights should start heading lower the last week of January, possibly showing a steady decline into mid-March.
| 4) | Seasonally, there's a tendency for February lean hog futures to falter over the next 2-3 weeks. |
CATTLE: (Progressive Grocer) -- The annual What's Hot culinary forecast released by the National Restaurant Association named "new cuts of meat" as the top trend for 2018.
Accordingly, the chefs and meat scientists of the National Cattlemen's Beef Association's (NCBA) "Beef. It's What's For Dinner" Culinary Center have put together a list of the top five innovative cuts that should be showing up more often in grocery and foodservice:
1.Shoulder Tender
2.Sirloin Bavette
3.Coulotte
4.Petite Sirloin
5.Tri-Tip Roast
2.Sirloin Bavette
3.Coulotte
4.Petite Sirloin
5.Tri-Tip Roast
While many of these cuts are available to the home cook, some are just starting to gain popularity in restaurants.
"If you like brisket, you might want to try a Tri-Tip Roast. Or, if you're in the mood for strip steak, you will probably enjoy the Coulotte," explains Chef Laura Hagen, senior culinary director for Denver-based NCBA, a contractor to the Beef Checkoff Program.
"It's exciting to see innovative cuts gain popularity across the country. Diners and home cooks shouldn't let a name they don't recognize keep them from trying something new."
The new BeefItsWhatsForDinner.com website has a section dedicated to beef cuts with details on everything, including where the cut comes from, how to cook it and similar cuts that can be substituted.
For example:
•The Shoulder Tender is a lean cut shaped like the tenderloin, but smaller. Like tenderloin, it can be cut into medallions and is appropriate for grilling, roasting or broiling.
•The Sirloin Bavette, also known as the sirloin flap, is a thin boneless cut that's great for fajita meat. It should be marinated and then grilled or broiled.
•The Coulotte, a juicy, savory roast, is known by many other names, including top sirloin cap. It's best roasted in the oven or smoked slowly on the grill. It can also be cut into coulotte steaks.
•The Petite Sirloin, also known as the ball tip, is a small roast. The value cut can be roasted, broiled, or braised.
•Finally, the Tri-Tip Roast is well known across much of the west, but is just gaining popularity on the East Coast. This lean cut is tender, full of flavor and can be grilled, roasted, braised or broiled.
The new year may be the perfect time for consumers to try a new cut of beef or a new beef recipe. With more than 60 percent of whole-muscle beef cuts considered lean and commodities experts predicting beef prices to decline in 2018, it will be easier for consumers to enjoy beef all year long.
Established as part of the 1985 Farm Bill, the Beef Checkoff Program assesses $1 per head on the sale of live domestic and imported cattle, in addition to a comparable assessment on imported beef and beef products. States may retain up to 50 cents on the dollar and forward the other 50 cents per head to the Cattlemen's Beef Promotion and Research Board, which administers the national checkoff program, subject to USDA approval.
The Beef Checkoff Program is administered by the Cattlemen's Beef Board, with oversight provided by the U.S. Department of Agriculture.
HOGS: (cphpost.dk) -- Last year 17.3 million pigs were butchered across Denmark -- almost a million fewer than in 2016 and the lowest number since 1992.
The industry claims that worn-down stalls in one of the primary reasons for the decline in the slaughter of pigs, but it is hopeful it can buck the negative trend this year thanks to recent support from the government.
"It takes time to turn a development like this around. The farmers have been hit hard since 2008 by the financial crisis and the industry has lost a lot of money since 2000," Nicolaj Nørgaard, the head of pig farmer advocacy group Danske Svineproducenter, told DR Nyheder.
"But I expect we'll butcher more pigs in 2018 than we did in 2017."
Aside from a new public investment fund that financially support farmers to establish new stalls, the nation's slaughterhouses -- led by Danish Crown -- have launched a new strategy that aims to ensure Danish slaughterhouses get an advantage compared to their European colleagues.
The food product association NNF, which represents employees working in the slaughter industry, is disappointed by the 2017 figures, but admits that some of the changes made recently need time to produce results.
The good news is that despite fewer pigs being butchered last year, most farmers made a profit in 2017. However, a number of economists are making dark predictions for the future of the Danish agricultural sector.
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