Beef packer inquiry could start to improve a bit Tuesday, but significant trade volume may be delayed until at least midweek. Initial asking prices should be around $116 to $117 in the South and $178 plus in the North. Live and feeder seem geared to open on a mixed basis as both sides assess the need to mark inventory before the Thanksgiving break.
The cash hog trade should kick off with bids steady to $1 higher. Given Thursday's break for the national feast, processors will work hard to make up for lost time later in the week. At this time, Saturday kill could amount to as much as 325,000 head. Lean futures are staged to open mixed as well thanks to a combination of follow-through buying and profit-taking.
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New showlists distributed in cattle feeding country Monday were generally smaller than the previous with only Kansas showing a few more ready steers and heifers.
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Although the December live cattle through June had at least partial rebounds through last week, the market struggled to establish any significant turn to an uptrend. Overhead resistance is now at the bottom end of the trading ranges that had been in place from mid-September through the end of October.
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The weaker basis and premiums in the late fall and winter live cattle contracts may encourage producers to resist lower bids from the packers.
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Many beef buyers contend that late-year holiday party needs are already booked. Some rib and loin demand still need to be covered in the next few weeks, but most of business has already been completed.
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The national comprehensive cutout report released on Monday indicated that out-front beef sales (i.e., 22 days or more delivery) remain at healthy levels (i.e., 1,069 load), suggesting good late-week demand.
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Despite all the swine fever noise, a waning cash market,prospects of record large hog supplies in the coming weeks and concerns that the U.S. industry can effectively move the resulting large pork supply, remains a market concern.
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China confirmed on Monday a new African swine fever outbreak in Heilongjiang province, the agriculture ministry said in a statement published on its website. The new case, found on two pig farms in the city of Haerbin, the capital of the northeastern province, killed 269 of the animals, the Ministry of Agriculture and Rural Affairs said.
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For the week ending Nov. 13, commercial merchants in lean hog futures reduced their long position by 1,400 contracts, now long 28,100.
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CATTLE:(Radio 57 WNAX)-- The European Union Trade Commissioner told U.S. Trade Representative Robert Lighthizer that including agriculture in any U.S. E.U. trade deal is a non starter. National Cattlemen's Beef Association's Senior Vice President of Government Affairs Colin Woodall says agriculture must be a part of those talks or there can't be any free trade agreement.
He says NCBA and other U.S. ag groups will be pressuring the USTR to make sure any trade deal worked out with the E.U. involves them removing any non-tariff trade barriers and basing trade on sound science.
Woodall says the most successful trade deals have been those that rely on sound science and remove non-tariff trade barriers.
HOGS: (Bloomburg) -- U.S. Vice President Mike Pence traded sharp barbs with Chinese leader Xi Jinping in back-to-back speeches at a regional summit, showing that neither country appears to be giving ground in an escalating trade war.
Xi received applause Saturday when he told the Asia-Pacific Economic Cooperation summit in Papua New Guinea that implementing tariffs and breaking up supply chains was "short-sighted" and "doomed to failure." He called for a stronger World Trade Organization and defended his signature Belt-and-Road Initiative, saying it's "not a trap as some people have labeled it."
Speaking moments later, Pence told delegates the U.S. offers countries in the region "a better option'' for economic and diplomatic relations than Beijing's heavy-handed approach. He warned against taking Chinese loans, saying the U.S. "doesn't drown our partners in a sea of debt" nor offer "a constricting belt or a one-way road."
The back-and-forth on a cruise ship docked in Port Moresby, the capital, suggested the world's biggest economies remained far from a deal to end a damaging trade war even after President Donald Trump said he was optimistic about a resolution. Trump and Xi are scheduled to meet a few weeks from now at the Group of 20 summit in Buenos Aires.
Trump told reporters Friday that the Chinese response to U.S. trade demands was largely complete but was missing four or five big issues. Those comments helped U.S. stocks erase losses, as investors bet on whether Trump will impose even more tariffs on Chinese goods than the $250 billion already in place. China has slapped tariffs on $110 billion in imports from the U.S. in retaliation. On Saturday, Pence warned that Trump could still put more tariffs on China. "We hope for better, but the United States will not change course until China changes its ways," he said. Later, Pence told reporters he was "very hopeful" the U.S. and China could reach a deal, but "things have to change" for that to happen.
"We're in a very strong position," Pence said when asked whether there was a deadline to end the trade war. "The American people know that we have to do something to reset this relationship with China economically. So, I don't think there's a timetable."
Xi gave no indication of giving in on some key U.S. demands, including an end to technology transfer, support for state-run enterprises, and giving up on its Made in China 2025 plan to lead the world in key industries. He said intellectual property rights are important to protect innovation but they shouldn't widen the digital gap between countries.
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