Walsh Trading Daily Insights
Commentary
The livestock rodeo show continued today with the horses jerking their riders to the ground once again. The cattle markets settled limit down, and hogs which have new limit levels at 3.75 handles, settled limit down also. Limits will be expanded for all markets with Live cattle expanded to 4.5 handles, Feeder Cattle to 6.75 and Hogs to 5.5. Processing plant shut downs and slowdowns continue to cause problems, in my opinion as Smithfield has shut down its Sioux Falls, SD pork producing plant and beef processing plants owned by JBS have been shut down in Colorado. This is tightening beef and pork supplies as the nations’ ability to produce meat for its consumers has been severely curtailed because of the Coronavirus that has spread throughout the country. With the scrutiny on packers by the government, it will be interesting to see haw they price the few cattle they buy in the open market this week. The have plenty of cattle already under their control and with the production slowdowns their needs are few for the negotiated market. Futures are not helping with their price action. The two most vulnerable ends of the food chain – producers and consumers will have a difficult time the next few weeks. There are sufficient volumes of supplies available, but the reduced slaughter will bring shortages and higher prices to consumers. Disease is not only occurring in the human population. The African Swine Fever continues to rage in China as 2 new cases were found in its Northern Provinces and Bird Flu was discovered in South Carolina’s Turkey industry. The African Swine Fever has led to huge purchases of pork and other meats by China and the European Union has banned US poultry from the US. What a crazy world we live in. It’s like watching an episode of the old TV series Soap. The more you see the more confused it gets. Stay tuned for the next episode!
Trade Suggestion(s)
Risk/Reward
Futures N/A
Options N/A
For those interested I hold a weekly grain (with Sean Lusk) and livestock webinar on Thursdays and our next webinar will be on Thursday, April 16,2020 at 3:00 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
www.walshtrading.com
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