According to the Kansas Agricultural Statistics Service, 49% of the Flint
Hills Bluestem pasture region are contracted for the full summer season, 31%
are under partial-season contracts, and 20% are leased for the full year.
The CME announced that beginning with the August 2009 contract three new
delivery points will be added to the live cattle contract. They are at Wray,
Colorado; Sioux Falls, South Dakota; and Worthing, South Dakota.
Tyson reported a $5 million loss for its second fiscal quarter ended March
29th. Tyson’s chicken unit lost $61 million due to a $102 million
increase in feed costs. The beef unit took an $11 million loss, while the pork
unit had an operating profit of $61 million and the prepared foods unit had a
profit of $20 million.
Seaboard Corp. reported at $4.8 million loss in the quarter ended March 29th,
a $25.7 million negative swing from its first quarter earnings of $20.9
million. Higher feed grain prices collided with lower pork product prices for
the vertically-integrated operation, which raises a significant portion of the
hogs it slaughters.
Pilgrim’s Pride Corp., the nations largest chicken producer announced on
May 5th that it lost $111.5 million in the quarter ended March 29th.
The results included impairment and restructuring charges of $17.7 million to
close a processing plant and 6 distribution centers. The company said its cost
for corn and soybean meal rose $200 million from a year ago.
The U.S.D.A. Cold Storage Report indicated at the end of March, pork
supplies in cold storage were 657.1 million pounds, 33% larger than last year,
and a new record high for any time period. Chicken stocks were up by 31%,
while beef stocks dipped 1% below year-ago levels.
Grains
Dougherty Funding, based in Minneapolis, Minnesota, filed a notice of
default on the loan for the Gateway Ethanol plant at Pratt, asking for the
full balance of the $53.4 million to be paid immediately. Orion Ethanol owns
62% of Gateway, while multiple investors own the rest.
Stats Canada reported a preliminary estimate for 2008 all wheat seedings of
25.109 million acres, up 3.492 million acres from 2007. The acreage increase
for wheat came from acreage decreases for oats, barley, and corn.
The National Grain & Feed Association, issued several recommendations to
improve the performance of CBOT grain contracts. The NGFA is recommending
storage rates be raised for CBOT ag contracts, a moratorium on all-hedge
exemptions for long-only investment capital, and an evaluation of the weekly
CFTC trade report that summarizes speculative trade positions. The group is
also supporting a CME Group proposal to clear over-the-counter grain swaps.
ADM reported third-quarter profits of $517 million, up from $363 million
last year. Results were driven by an almost 7-fold increase in profits at ADM’s
Ag Services division, which includes the company’s grain-trading,
transporting and handling business. Profit in the company’s corn-processing
business, including its ethanol production, fell 32% to $172 million.
Agrium, the world’s third-largest nitrogen producer reported a profit of
$195 million in its first quarter. Calgary, Alberta-based Agrium has become
the largest U.S. retailer of fertilizer, seed and chemicals after acquiring
UAP Holding Co. for $2.65 billion.
