China Was Third Largest Buyer of U.S. Pork Last Week By Dennis Smith
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Thursday November 29, 2018
Cut right to the chase today. Weekly pork export sales were very large, again, at 20,900 MT, up 7% from the 4-week average. Mexico was the largest buyer taking 7,200 MT which explains what we’ve been seeing in the ham market, Japan took 4,600 MT and guess what, China was in for 3,300 MT of U.S. pork last week. This alone should put a positive spin on futures today. Cash was higher and not lower yesterday which should also support the Dec hogs in particular. There’s nothing fancy to report in the volume and open interest from yesterday. Look for a rally today.
In sharp contrast to the pork, beef export sales were lousy last week, reported at 9,100 MT, down 42% from the 4-week average. Shipments were off 12%. Closer to home, my sources are warning of a severe winter storm for next week in the north plains. There’s talk of 12 inches to as much as 24 inches of snow. Feedlots in IA continue to sell cattle with the cash prices actually edging upward on the range. In other words, the low end of the range continues to edge upward. Tuesday’s trade in IA was from 112-116 with the Wed trade occurring from 114-116. The hot beef market seems to be established at $183. Our liquidation target in the Dec LC stands at 11750. The technical road map calls for a rally into early Dec followed by what we believe to be the ever important seasonal low into the middle of Dec. Our upside liquidation target in Jan FC bullish positions is 15200.
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