Sample – US Daily Market Report

THE DAY AT A GLANCE

• Bids low in volume and price
• Butts $22.00
• Natives $24.00
• USDA slashes meat production forecast
• Alberta NDP, union urges shutdown of Cargill High River plant
• Yue Yuen April sales down 19%
• Xingye Q1 performance loss related to pandemic
• Sellers holding firm

BUTT BRANDED STEERS

1. 62/64 lbs. sold for $22.00.

HEAVY NATIVE STEERS

1. Seasonal weights were heard to sell at $24.00.

HEIFERS

1. A sale of seasonal weight brands was reported at $15.00 but sources called the price higher than the real market.

INDUSTRY NEWS

USDA slashes meat production forecast

In its monthly outlook, the USDA has cut its annual forecasts for pork, beef and chicken production due to Coronavirus outbreaks among plant workers.

The unprecedented U.S. processing disruptions have brought cattle and hog slaughter numbers down by more than 30%.  Across the top four proteins, the USDA reduced estimates by about 4.7 billion pounds from last month.

Total U.S. pork output is forecast at 27.45 million pounds for this year, down from 27.65 million in 2019. Beef production is expected to be 25.83 million pounds, down from 27.221 million in 2019. The USDA predicts that production of each protein will rebound in 2021.

“For 2020, the total red meat and poultry production forecast is reduced from last month as the sector adjusts to COVID-19 and economic uncertainty,” the agency said. “Beef production is reduced as lower expected cattle slaughter more than offsets heavier carcass weights. Pork production is forecast lower on a slower expected pace of slaughter.”
 

Alberta NDP, union urges shutdown of Cargill High River plant

Financial Post
 

Alberta’s Opposition NDP and union leaders are calling on the province to shut down a Cargill meat-packing plant so it can be determined whether the company is meeting legal obligations to involve workers in safety concerns.

An Occupational Health and Safety report says Cargill didn’t include workers in an internal review last month of circumstances that led to about 950 confirmed cases of COVID-19 in employees at the plant in High River, Alta.

The department has given the plant, which has 2,000 workers, a week to make that happen.

“Unfortunately, one death reported over the weekend was an employee from Cargill who fell ill last month,” said Dr. Deena Hinshaw, chief medical officer of health. “Although we are speaking about this today, the individual was hospitalized about a month ago.”

The union said more employee involvement is needed to make sure the slaughterhouse is safe.

Christina Gray, labour critic for the NDP, told a news conference it’s frustrating that the United Conservative government hasn’t guaranteed the safety of Cargill workers.

“This is not a safe work environment. We believe the government is responsible and the employer is responsible and there must be a public inquiry after the emergency has ended, but that will be a ways away,” she said.

The plant processes about 4,500 head of cattle a day — more than one-third of Canada’s beef-packing capacity. It shut down for two weeks in April because of the outbreak, but reopened last week. The province said Monday there are 36 active cases among workers from the plant, and 911 have recovered.

On Sunday, another Cargill plant south of Montreal announced it will temporarily close its doors after at least 64 workers there tested positive for COVID-19.

A Cargill statement said the OHS has given the company more time to complete its investigation into the High River plant and to further involve the facility’s joint health and safety committee.
 

Yue Yuen April sales down 19%

Yue Yuen Industrial Ltd., the world’s largest sports footwear manufacturer, reported April revenues of $710 million, down 19.1 percent from $877.9 million in the same month a year ago.

In the four months, sales were down 20.3 percent to $2.68 billion from $3.36 billion in the same period a year ago.

Pou Sheng International Ltd., the retail subsidiary of Yue Yuen, reported revenue of ¥2.2 billion in April against ¥2.48 billion a year ago, a decline of 11.2 percent. Sales in the fourth months were down 21.2 percent to ¥7.15 billion from ¥9.07 billion a year ago.
 

Xingye Q1 performance loss related to pandemic

Panorama
 

Xingye Technology held its 2019 annual performance briefing on the Panorama Network on Monday. Company’s president Sun Huiyong said that the company’s operating performance has improved significantly since 2018. The company will further adjust its customer structure and product structure according to market demand, actively develop new products and increase the added value of products. On the basis of ensuring the upper leather market, it will actively expand new leather applications and develop new markets. The company has changed from the original single-selling leather to providing a total natural leather material solution according to customer needs, using technology and service as an entry point, and establishing a close cooperative relationship with customers. The company’s first-quarter performance loss was mainly affected by the epidemic and the related production and sales declines.
 

MARKET OBSERVATIONS

1. Sellers say bids on steers this week are largely $2.00 to $3.00 below last sales.
2. Buyers are walking away from countered bids.
3. Sources note that business in Korea is reportedly very bad and that warehouses in Thailand and Taiwan are full of inventory.
4. Shipping difficulties have eased a bit with vessel space a little easier to come by. Equipment is still a challenge in some areas.
5. Reports of buyers refusing older, more expensive contracts continue to grow.

FEDERALLY INSPECTED SLAUGHTER

 
Tuesday’s slaughter included 65,000 steers/heifers and 24,000 cows and bulls.
 

PRICES AT THE CLOSE OF TRADING TODAY