Mixed Livestock Outlook
For the year compared to 2019 cattle slaughter is off 981,000 head or 6.0 percent lower. Somewhere there are cattle that need to be slaughter. Packers are making up kills with a bigger Saturday slaughter. However, continuing working 6 days a week can’t go on much longer. With COVID 19 increasing in the Southwest, it is possible there will be some cattle packers shutting down for what is called “super cleaning.”
Net export sales at 24,100 metric tonnes is lower than it needs to be if pork is to move higher. With exporters decreasing previous commitments, it isn’t positive. China is buying pork but is buying much less than it did during the first 4 months of 2020. Mexico continues to be a strong buyer and is likely the reason fresh hams moved off the lows.
Besides the EU pork producing countries selling pork to China with additional trade agreements made during the US and China tariff war, Brazil made agreements with China and Chinese investors have plowed money into the Brazilian pork, beef and poultry industries.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.