Cash cattle trade was similar to last week in that it took time to develop enough sales to establish trends. Prices are steady and firm. In some parts of the country it took higher bids to buy cattle, but it would be a stretch to call the market a full $1 higher. Market cow demand remains strong. With fed cattle packing plants close to full production and fed cattle weights continuing to move in the wrong direction, there is a good supply of beef fat. (Carcass weights were up another 4 pounds according to the most recent report, 38 pounds heavier than a year ago for an average 879 pounds.) That has increased the need for lean trim to grind with fat for ground beef. The beef cutout value is steady this week and started the week higher. This was the first positive gain for cutout value since May 12, 2020. Two USDA cattle reports will be released Friday (July 24.) The Cattle on Feed report is expected to show higher marketings compared to a year ago and that will be a welcomed change from the two most recent reports. Industry estimates are for cattle on feed to be about equal to a year ago, placements 3.6 percent higher, and marketings 1 percent higher than a year ago. The twice annual Cattle Inventory report will also be released Friday. Beef cow numbers are expected to be 1 percent below July 1, 2019. The January 1 report listed Wisconsin beef cow numbers at 310,000 head. Wisconsin has been growing its beef cow herd, and is one of the few states doing so.
Farm gate hog prices still aren’t good, but did move higher this week. Harvest has been running 130,000 to 180,000 head a week above a year ago. Pork cutout values are on the rise. Hog weights, unlike cattle, continue to come down. Wednesday’s (July 22) Cold Storage report indicated that frozen pork supplies are 1 percent less than the previous month and 25 percent below a year ago. Pork export sales remain strong with sales for future delivery of 32,100 metric tons from July 10 through July 16. Domestic demand for pork has been strong. According to this week’s Jim Long Pork Commentary there were three Eastern Cornbelt Packing plants actively looking for pigs, and the report noted that sow slaughter is up. Will cash prices continue to work higher and come more in line the Lean Hog futures contracts given the positive indicators? One could make a strong argument for higher prices in the near future. The same challenges of packing capacity remaining at current levels, demand (both export and domestic) remaining strong, and businesses staying open will keep the market nervous and watching headlines. It does appear the situation for pork producers will improve, and that’s good news for an agricultural sector that has lost an estimated $5 billion dollars due to Coronavirus implications.
Export sales for pork this week were 32,100 metric tons. Beef export sales saw the best week of 2020 last week, and saw a more modest 15,600 metric tons in sales this week. China has been purchasing large amounts of corn and soybeans recently. This latest weekly sales report shows 2.55 million metric tons of corn and 2.67 million metric tons of soybeans sold for export. China was the largest buyer. Most of those sales are for new crop corn and beans, so shipment won’t take place until after the fall harvest. Mounting tensions with China could impact trade moving forward, but hasn’t seemed to effect sales to the country yet.
Burger King has pulled TV advertising deemed demeaning to farmers. The fast food chain made news with a campaign saying it would cut greenhouse gas emissions by feeding cattle lemongrass. According to Dr. Frank Mitloehner, University of California-Davis air quality Extension specialist, department of animal science, some of the message is inaccurate, and feeding lemongrass would likely have less of an impact than Burger King says. Mitloehner says US beef production contributes 3 percent of all greenhouses gasses and adds that fossil fuel use and production contributes 80 percent.
DATCP is offering Question, Persuade, Refer (QPR) virtual training for service providers and farmers. QPR is an intervention method designed to help trainees identify and interrupt mental health crisis situations and direct individuals to proper care. Dates and information: https://content.govdelivery.com/accounts/WIDATCP/bulletins/29631d2 #
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