MARKET NEWS HIGHLIGHTS
October 30, 2019
Foods announced it will prohibit the use of ractopamine in all the
market hogs it buys starting in February 2020. Most of the hogs
delivered to Tyson's pork plants are purchased from about 2,000
independent farmers. These producers have until February 4th
to meet the new requirement. Tyson Fresh Meats is the largest
American-owned pork processor and generates almost $1 billon export
average choice retail beef price for September was reported at 600.6
cents per pound, down about 7 cents from August, but still 7 cents
higher than the previous year. The all-fresh beef price was quoted
at 577.6 cents per pound, down 7 cents from the previous month. The
average retail pork price in September was estimated at 387.9 cents
per pound, an increase of over 9 cents from the previous year.
pork stocks in cold storage at the end of September were reported at
598.9 million pounds, up 2% from a year ago. Pork bellies in the
freezer were pegged at 40.67 million pounds, up 10.3 million pounds
from September 2018. Total beef stocks were reported at 464.2
million pounds (92% of last year), while total chicken stocks were
at 915.0 million pounds (96% of last year).
USDA October Cattle on Feed report, the number of steers on feed as
of October 1st
were pegged at 6.871 million head, down 222,000 head from last year.
On the other hand, the number of heifers on feed totaled 4.407
million head, up 100,000 head from last year. Heifers represented
39.1% of the total number of cattle on feed, which is considered to
be at a level of cattle cycle liquidation.
October 17th, an
explosion at a small, stand-alone building at the Cargill beef plant
at Dodge City temporarily suspended slaughter operations. The
fabrication shifts remained on schedule. The plant was closed for
slaughter on Thursday, Friday, and Saturday, and returned to
production the following Monday, October 21st.
Energy Corp. reported that its ethanol segment had an operating loss
of $43 million in its fiscal third quarter compared to a $21 million
profit the previous year. The company's renewable diesel segment
reported operating income of $65 million in the quarter. Valero
currently owns 14 ethanol plants with a combined capacity of 1.73
billion gallons per year.
Renewable Fuels Association, American Coalition for Ethanol, Growth
Energy, National Biodiesel Board, National Corn Growers Association,
and National Farmers Union have together filed a legal challenge
against EPA's approval of 31 additional small-refinery exemptions in
August. The groups allege the 2018 SRE decision was signed August
9th, 2019, but it
was not published in the Federal Register. In fact, its existence
remained a secret until September 19th,
2019, when EPA attached it as an exhibit to a filing in the US Court
of Appeals for the 10th
Circuit. The groups also contend the EPA only provided a 2-page
document explaining its rationale for 31 exemption on August 9th.
USDA announced on June 13th
it would relocate two research agencies out of Washington DC to
Kansas City as part of a controversial relocation. The number of
Economic Research Service (ERS) and National Institute of Food and
Agriculture (NIFA) employees that agreed to make the move is far
less than the expected 500 NIFA and ERS jobs. As of October 12th,
ERS had 31 employees onsite in Kansas City with 72 employees
permanently remaining in Washington. NIFA has 54 employees in
Kansas City, with 18 employees remaining in Washington. The USDA is
currently recruiting people for the open positions. A USDA
cost-benefit analysis estimated the move would save about $20
million a year.
As of October 27th, 41% of the nation's corn crop was harvested compared to 61% for the 5-year average. Soybean harvest was further advanced at 62% compared to the 5-year average of 78%. The following states were below 30% cut on corn - Iowa (26%), Michigan (21%), Minnesota (20%), North Dakota (6%), South Dakota (14%), and Wisconsin (13%). The states that were under 50% done on soybean harvest include Missouri (43%), North Carolina (39%), North Dakota (29%), and Wisconsin (46%).