Tag Archives: cattle

Crazy week of reports.  From the January 10th report, Phase One, USMCA…but still beans had a rough week.  Shows volatility & one needs to be prepared.  Last 60 days we have been in a tight range.   Ethanol margins remain tight…China even mentioned ethanol in Phase One.  South American weather & current harvest.  Hogs could see the boost from the trade deals.  There is money to be made in the cattle market right now.

Tomorrow’s signing day with China.  A lot of stories about what be included.  WTO guidelines.  Chinese imports.  Bird flu update for China.  Turkey’s in Northern Hungary as well.  We continue to see tight ethanol supplies.  Weather updates for South America.  Corn harvest 2% done in Brazil. Global wheat crop.  Livestock market & what China’s hog market looks like.  Some short term technical on cattle.

 

Higher corn, lower beans & wheat.  Quiet day in the market trade. China needs help…food for both people & livestock.  Will we see any fireworks from Wednesday’s signing?  Bird flu in China with swans.  Ethanol margins remain tights.  Weekly export numbers on the softer side.  Why are we seeing lower numbers in the livestock?  Chinese New Year Celebrations.

 

USDA WASDE Report.  Nothing friendly on the grain report.  Unicorn type of day!  Brad explains.  How do the basis numbers look?  Ethanol/DDG’s & China.    Cattle prices were higher with the hopes that the cash would see some higher Friday trade numbers.  Macro’s for the cattle not great.  Middle of a big fund role.  Negative side of the market is the cut-out value-cutting back on Saturday kills.  No real threat in the weather-does that make you nervous?  Hogs still caught in the same trading range.

 

Pre-Report trade. If the wheat is leading higher on the S&D Report the dollar will have a reaction. Trade might not be worried about the corn.  bullish surprise in the report though could be the corn, seeing where we are at in harvest.   Phase Two comes after elections.  Phase one is on track for January 15th.  Iran still being talked about.  World Supply Demands with South America.  Winter seeding for the wheat brought to the front of the classroom.  USMCA.  Wall Street Journal & the tide turning.  Cattle market & waiting for the cash continues to be on the quiet side.

China…they are scrapping their ethanol program & what does that mean?  GCI China talks of lifting duties on DDG’s.  Ethanol mandate by 2020, was never bought into.  Due to weather, the USDA report delayed until Friday along with the WASDE report.  Political talk making national news, is the current issues with Iran having any effect on the markets?  ASF hits again in Bulgaria.  Consolidation in the cattle as they wait for the cash to fully develop.

 

U.S. pork exports posted the best month on record in November, easily reaching new highs in both volume and value, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). November exports of U.S. beef were below the previous year’s large totals.

Pork exports surged to 259,812 metric tons (mt) in November, up 26% year-over-year and 11% above the previous high set in July 2019. Export value was $712.7 million, up 32% from a year ago and breaking the previous record (also from July 2019) by 14%. These results pushed January-November exports 7% above the previous year’s pace in volume (2.39 million mt) and 6% higher in value ($6.19 billion). Pork exports are now on pace to exceed previous records for both volume (2.45 million mt in 2017) and value ($6.65 billion in 2014).

Pork export value per head slaughtered was $62.90 in November, up 29% from a year ago and the highest in five years. Through the first 11 months of 2019, per-head value averaged $52.24, up 2% year-over-year. November exports accounted for 29.7% of total pork production and 26.8% for muscle cuts only, up substantially from a year ago (24.5% and 22%, respectively). For January through November, exports accounted for 26.4% of total pork production and 23% for muscle cuts, up from 22.4% and 25.7%, respectively, a year ago.

November beef exports totaled 108,662 mt, down 4% from a year ago, valued at $658.1 million (down 7%). For January through November, beef exports trailed 2018’s record pace by 3% in both volume (1.21 million mt) and value ($7.4 billion). However, 2019 is already the second-highest year for beef export value, trailing only the 2018 record of $8.33 billion.

Beef export value per head of fed slaughter was $307.55 in November, down 15% from a year ago. Through November, per-head export value averaged $308.74, down 4%. November exports accounted for 13.7% of total beef production and 11% for muscle cuts only, down from 14.1% and 11.8%, respectively, a year ago. For January through November, exports accounted for 14.1% of total beef production and 11.4% for muscle cuts, down from 14.5% and 12%, respectively, a year ago.

Pork surge to China/Hong Kong continues; export value to Mexico rebounds

Demand from China/Hong Kong continued to drive U.S. pork export growth in November, with volume climbing to 86,213 mt— up 284% from a year ago — valued at $204.9 million (up 240%). For January through November, exports to the region were up 71% to 554,789 mt, valued at $1.18 billion (up 49%).

Although November pork export volume to Mexico was lower than a year ago at 57,537 mt (down 6%), export value surged 28% to $124.3 million, the highest since July. For January through November, exports to Mexico were down 11% from a year ago in volume (641,952 mt) and 6% lower in value $1.14 billion. Competition from Canadian pork was especially strong in the Mexican market while Canada was suspended from China (late June to early November). From January through November, Canada’s exports to Mexico increased 8% from a year ago to 128,100 mt, valued at $185 million (up 14%).

“While the surge in pork shipments to China will capture most of the headlines this month, it is equally encouraging to see export value to Mexico make such a strong recovery,” said Dan Halstrom, USMEF president and CEO. “Getting exports to Mexico back to the record levels of 2017 and early 2018 is a top priority for the U.S. pork industry, because demand from Mexico is such an important driver of profitability for everyone in the supply chain. The same is true in Japan, so it’s very important to reclaim lost share in these longtime mainstay markets. ”

November exports to Japan trailed the previous year by 3% at 32,594 mt, while value was down 1% to $136.5 million. Through the first 11 months of the year, exports to Japan were down 6% from a year ago in volume (340,568 mt) and 7% lower in value ($1.4 billion). Japanese import data show imports of U.S. pork decreased by $121 million with much of the decline being in ground seasoned pork, which fell by $73 million due to the wide tariff rate discrepancy. Beginning Jan. 1, Japan’s tariff rates on U.S. pork and pork products were lowered to match those imposed on European, Canadian and Mexican pork, eliminating a significant price disadvantage that slowed U.S. exports in 2019. The rate for U.S. ground seasoned pork fell from 20 to 13.3%.

January-November highlights for U.S. pork exports include:

  • Exports to Colombia rebounded in November to pull 9% ahead of the previous year’s pace in volume (92,280 mt) and 7% higher in value ($203.6 million). Also bolstered by strong growth in Chile and Peru, exports to South America already surpassed previous full-year records in both volume (141,657 mt, up 18% year-over-year) and value ($356.2 million, up 22%).
  • Led by strong growth in Panama, Guatemala, Honduras and Costa Rica, exports to Central America also set new annual records for volume (86,794 mt, up 16%) and value ($211.8 million, up 20%).
  • Surging demand in Australia and New Zealand pushed exports to Oceania to new heights. Exports to the region jumped 36% from a year ago in both volume (105,399 mt) and value ($304.5 million).
  • Exports to Canada increased 6% from a year ago in both volume (197,847 mt) and value ($738.2 million).

Beef exports to Korea, Taiwan headed for new records

Although November beef exports to South Korea were lower than a year ago in volume (19,116 mt, down 5%) and value ($139 million, down 11%), the market remained on pace to break the 2018 records. Through November, exports to Korea were up 6% in both volume (234,310 mt) and value ($1.69 billion). U.S. share of Korea’s chilled beef imports reached 62%, up from 58% in 2018. U.S. beef accounted for 51% of Korea’s total beef and beef variety meat imports and more than one-third of Korea’s total beef consumption.

Beef exports to Taiwan will be record-large for the fourth consecutive year in 2019. November exports were 4,869 mt (up 8% from a year ago) valued at $43 million (up 7%). This pushed January-November results 8% ahead of the previous year’s pace at 57,837 mt, valued at $513.3 million (up 4%).

The gains in Korea and Taiwan have been offset by a decline in Japan, which is still the largest destination for U.S. beef exports but one in which the U.S. industry has faced a steep tariff rate disadvantage compared to imports from Australia, New Zealand, Canada and Mexico. Through November, exports to Japan were down 6% from a year ago in volume (287,090 mt) and dropped 7% in value ($1.8 billion). But on Jan. 1, U.S. beef gained tariff relief in Japan that brings rates in line with key competitors, so the outlook is very positive for 2020.

“The Japanese market performed extremely well for U.S. beef in 2018, even though we were already facing a tariff rate disadvantage versus Australia,” Halstrom explained. “More competitors saw tariff rate cuts in 2019 under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which further tilted the playing field against U.S. beef. For example, Canada’s beef exports to Japan increased 57% last year. So the rate cuts Japan recently implemented for U.S. beef are long overdue, and USMEF is working aggressively with U.S. exporters and the Japanese trade to capitalize.”

January-November highlights for U.S. beef exports include:

  • In Mexico, the third-largest market for U.S. beef behind Japan and Korea, exports increased 4% from a year ago in value to just over $1 billion despite a 2% decline in volume (214,963 mt). This was largely due to a strong value increase for tripe, one of the top U.S. beef variety meat export items to Mexico. Variety meat exports were up 2% year-over-year in volume (89,667 mt) but jumped an impressive 18% in value to $244.5 million. This included $88 million in tripe exports, up 28%.
  • Led by strong demand in Indonesia and steady growth in the Philippines, beef exports to the ASEAN region increased 23% from a year ago in volume (55,583 mt) and were 7% higher in value ($270.6 million).
  • Exports to the Dominican Republic already surpassed the 2018 record, increasing 24% in volume to 7,523 mt valued at $61.4 million (up 19%).
  • In Central America, strong demand in Guatemala and Panama helped push exports 4% higher than a year ago in volume (14,044 mt) and 9% higher in value ($79.9 million). Export value to Guatemala and Panama jumped 9% and 25%, respectively.
  • Mexico and Japan have led a very strong year for global exports of U.S. beef variety meat, which were up 4% from a year ago in volume (295,527 mt) and 9% higher in value ($885.9 million). Exports to Japan, which largely consist of tongues and skirts, were up 20% from a year ago to 58,278 mt, valued at $355.5 million (up 13%). Egypt, the largest destination for U.S. beef livers, saw a 4% increase in volume (59,203 mt) while export value climbed 17% to $69 million. Led by strong demand in Indonesia, variety meat exports to the ASEAN increased 39% in volume (16,595 mt) and 43% in value ($37.3 million). Strong growth in the Dominican Republic and Trinidad and Tobago pushed variety meat exports to the Caribbean 17% higher in volume (6,814 mt) while value surged 61% to $14.2 million.

November lamb exports trend lower

November exports of U.S. lamb were 1,253 mt, down 10% from a year ago, while value also dipped 10% to $2.19 million. Through the first 11 months of 2019, lamb exports remained well ahead of the previous year’s pace in volume (14,507 mt, up 23%) and value ($23.7 million, up 11%). Led by strong demand in Mexico, lamb export volume is the largest since 2011 and export value is set to exceed $25 million for the first time since 2014. In addition to Mexico, growth markets in 2019 included Trinidad and Tobago, Panama, Guatemala and the Philippines.

Complete January-November export results for U.S. beef, pork and lamb are available from USMEF’s statistics Web page.

Monthly charts for U.S. pork and beef exports are also available online.

If you have questions, please contact Joe Schuele at jschuele@usmef.org or call 303-547-0030.

NOTES:

  • Export statistics refer to both muscle cuts and variety meat, unless otherwise noted.
  • One metric ton (mt) = 2,204.622 pounds.
  • U.S. pork currently faces retaliatory duties in China. China’s duty rate on frozen pork muscle cuts and variety meat increased from 12 to 37% in April 2018, from 37 to 62% in July 2018 and from 62 to 72% on Sept. 1, 2019. (The rate was reduced to 68% on Jan. 1, 2020, when China cut its most-favored-nation rate from 12 to 8%.) Mexico’s duty rate on pork muscle cuts increased from zero to 10% in June 2018 and jumped to 20% the following month. Beginning in June 2018, Mexico also imposed a 15% duty on sausages and a 20% duty on some prepared hams. Mexico’s duties were removed in May 2019 but were in effect for much of the period reported above.
  • U.S. beef faces retaliatory duties in China. China’s duty rate on beef muscle cuts and variety meats increased from 12 to 37% in July 2018 and from 37 to 47% on Sept. 1, 2019. Canada imposed a 10% duty in July 2018 that applied to HS 160250 cooked/prepared beef products. Canada’s duty was removed in May 2019 but was in effect for much of the period reported above.

Blahh negativity markets. Seems to be the tone for the trade this week. A lot of stock being put into this trade deal. January report…different from last year when we had no report. USMCA moving forward in the Senate. Weather in South America. Some spread activity in cattle, nothing like what we saw in yesterday’s trade. Hog market looking at China going into deep freeze for pork to feed people. Impossible Foods wanting to move into the “Pork” market & offer to Asia.

 

Quiet grain trade, full trading week, coming out of holidays, focus turning towards taxes.  China signing, USMCA talk.  Political action, South America.  Now into an election year.   USDA report out on Friday.  Corn & wheat lower, beans higher.  Struggles in Australia & the effects on the U.S. markets.  Strong start to the marketing week for cattle.  Is there a chance for a pull back on cattle Tuesday?

 

TOPEKA, Kan. — The 14th class of the Kansas Livestock Association (KLA) Young Stockmen’s Academy (YSA) graduated last month at the close of the KLA Convention. Merck Animal Health again partnered with KLA to host 20 members for a series of four seminars throughout 2019. This class brings the total number of YSA alumni to 280.

Attending the KLA Convention was the final session for this year’s class. The three-day event provided participants the opportunity to gain additional industry knowledge and interact with other KLA members from across the state. YSA members got a firsthand look at the inner workings of the association by attending the KLA Chairmen’s Circle meeting. The group also participated in the policy-making process by attending committee and council meetings where members discussed issues affecting their business interests, including labeling of meat alternatives, animal disease control, traceability and mandatory price reporting. Immediately prior to the convention, the YSA class participated in an in-depth spokesperson training session with National Cattlemen’s Beef Association (NCBA) Senior Director of Organizational Communications Kate Maher. The group also heard from NCBA President Jennifer Houston of Sweetwater, TN.

During their first session in Topeka last February, attendees were exposed to advocacy training, the legislative process and services provided by KLA and NCBA. The second installment took the group to Kansas City in May, where they learned about beef marketing and agribusiness. YSA members visited central and western Kansas in September to tour beef and dairy operations representing various segments of each industry.

Members of the 2019 YSA class are Bryce Barnett, Muscotah, Hannah Brass, Medicine Lodge; Carl Clawson, Ulysses; Ashley Fitzsimmons, Pratt; Heather Gibson, Satanta; Grace Hammer, Sharon Springs; Jamie Holeman, Bronson; Taylor Hughes, Pratt; Clayton Jarnagin, Protection; Reed Koop, Abilene; Clinton Laflin, Russell; Socorro Martinez, Liberal; Garrett McKinney, Walton; Michaela Peterson, Dodge City; Cami Roth, Sterling; Dalton Rutledge, Plains; Jessalyn Strahm, Sabetha; Thomas Thayer, LaCygne; Patrick Turner, Ingalls; and Evan Woodbury, Quenemo.

KLA is a trade organization representing the business interests of members at both the state and federal levels. Voluntary dues dollars paid by producers are used for programs that benefit KLA members in the areas of legislative representation, regulatory assistance, legal troubleshooting, communications and the advancement of youth.