Packer
A solid rally for cash fed cattle coupled with declining total feeding costs helped boost cattle feeding margins nearly $85 per head above the previous week. Pork margins now over $40 for the fourth consecutive week.
Shorter production and processing schedules have produced the desired effect for packers – a rally in wholesale beef markets. Feeders gain more marketing leverage.
Shares of Brazil’s JBS SA rose 7% in early morning trading on Wednesday after the world’s largest meatpacker reported strong first-quarter results in spite of headwinds faced by its large U.S. beef business.
The Meat Institute has updated its Animal Handling Guidelines and Animal Welfare Audit to include scores for each criterion allowing members to set goals.
Harvest picks up and packers are now finding themselves trying to bridge the gap between yearlings and calves. Smaller showlists create a challenge for packers.
The Meat Institute has worked to educate member companies to improve age and identity verification and develop new programs and technology to detect identity fraud and more.
Batista brothers have been elected to JBS SA board of directors.
This growing beef-on-dairy health problem is costing packers two major things – time and money.
Declining cattle futures provided leverage for packers to collect inventory with softer bids.
The margin spread between packer losses and feedyard profits expands as wholesale beef prices continue their retreat. Pork producer profits continue increasing.
Under pressure from negative margins, packers will continue to play their games but their activity last week led to the biggest harvest rate in seven weeks.
Does more negotiated cash cattle trading benefit feeders or packers? An evaluation of packer gross margin provides some perspective.
Last week’s rally to new record prices pushed packer and feeder margins in opposite directions. Pork producer margins continue higher with prices now above year ago.
Cash fed cattle prices reached new record highs in all feeding regions last week, but the trade was a bracket-buster for packers who were forced to pay up as wholesale beef prices declined.
Firefighters were dispatched to National Beef’s 6,000-head per day facility in Liberal, Kansas, Wednesday evening.
The economic environment of both the beef and pork industries has changed. Capacity utilization for both beef and pork has a significant impact on margins and the market impact goes beyond supply and demand.
Beef packers slow harvest lines and scramble for inventory as they attempt to keep a lid on cash prices.
Similar to last year, packers have idled the harvest pace lower in an effort to keep prices in check. The strategy favors more late-week trading.
Calling the packers’ bluff, cattle feeders held out for higher bids and were rewarded with the highest prices in over three months.
Improving prices for live cattle and wholesale beef lifted margins for both feeders and packers. Pork producers also found improved margins but remain in the red.
Packers came into the market last week ready to add inventory after winter storms disrupted harvest schedules the previous two weeks.
Calves born in extreme cold quickly utilize all body fat reserves and exposure to wind can exacerbate temperatures. Preparing in advance of inclement weather can lead to improved calf survival.
Negotiated cash trade finished the week in a standoff with few sales and little price movement. Feeders and packers both look to benefit from improving winter weather and pen conditions this week.
A mid-January deep-freeze failed to deliver any bounce to cattle markets as packers appear flush with formula and contracted inventories. Friday’s Cattle on Feed report fell within expectations.
Severe winter weather across cattle feeding country reduced weekly harvest and damaged feeding performance. Cattle feeders will seek higher prices this week.
A year ago feeders were concerned about weathered cattle and tough pen conditions and how at times it would be the motivation for sellers to take the market. It’s eerie how not much has changed in that sense.
The final week of 2023 found at least three bidders in the market in multiple regions.
JBS parent company J&F Investments has paid about 28% of the fine levied against the giant meatpacker in 2017 over a political bribery scandal.
Cattle feeding margins fell deeper into the red while packer losses doubled from the prior week. Pork producer margins have now printed red every week for the past year.
Another round of falling futures produced another round of lower cash bids. Cattle feeders now offer their smallest showlists of the year.