Weekly Beef Exports Sales Strong
By Dennis Smith
Follow me on Twitter @denniscattle
Thursday August 8, 2019
Cash will be called lower simply because they can. I just read a story indicating that China has plenty of frozen stocks and a vaccine for ASF will be ready by the time they chew through the frozen stocks. The story also indicated that China said “they’re not buying any more U.S. ag products”. So now we’ve gone full circle on this story. This is one of the most ridiculous stories I’ve read in a very long time. In the meantime, weekly pork export sales were good at 13,700 MT with Canada the largest buyer followed by Mexico, S. Korea, China (yes, China purchased 1,400 MT last week) and Japan. Shipments were outstanding at 26,700 MT with China taking 8,600 MT followed by Mexico taking 6,700. These are solid numbers and should support the board today. Volume in futures was 61,100 with an impressive build in open interest (up 3,800) on the rise in prices. Look for three items today; 1) volatility, 2) support on sharp breaks and 3) likely another higher close.
There’s still no widespread cash steer trade to report. Prices appear to be fully steady to possibly a touch higher. LC futures volume yesterday was 56,100 with open interest down 1,200. Weekly beef export sales were outstanding at 22,000 MT, up 41% from the 4-week average. Hong Kong was the largest buyer, taking 8,300 MT followed by Japan purchasing 4,500, Canada, S. Korea and Mexico were also good buyers of U.S. beef. Shipments were also excellent at 18,200 MT, up 8% with Japan and S. Korea taking large shipments of beef. If you need to hedge feeders we’ll be working orders in the Oct FC options. If LC futures jump 100 points today we’ll also be hedging in this market.
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