Daily Livestock Report for 3 Aug 2010

Market Comments

Livestock futures ended the week on a high note as most hog
and cattle contracts continued to build on earlier gains. Sharply highergrain prices are clearly negative for producer profitability going forward
and higher cattle and hog prices reflect the higher costs of doingbusiness later this year and in 2011. 2011 corn futures are above $4
per bushel despite expectations of good yields this fall. The rise in corn
prices, they are up by more than 60 cents or 18% since late June, has in
part resulted from a reassessment of current corn stocks. Both the supply
and quality of corn appears to be worse than previously thought.
More recently grain markets have been buoyed by reports of wheat croptroubles in Russia and other former Soviet countries. As it was the
case with Australia a couple of years ago, it takes time for the full extent
of the damage to become known and we are seeing reports of even
lower production prospects for wheat, barley and other grains in that
part of the world. December Chicago wheat prices were up by more 34cents per bushel on Friday and for the week they gained some 74 centsper bushel. For the week, Dec corn and Nov soybeans were up 24 and
26 cents, respectively.

In addition to a more bullish outlook for grain prices later this
year and in 2011, livestock futures have also benefited from strong
grains in product markets. Pork continues to lead the parade, with
very strong prices for a number of items. Pork bellies hit $135 /cwt this
week, a new all time record. August belly futures on Friday were
$103.5 /cwt, which is not all that unusual as basis levels tend to be the
highest during this time of year. Pork supplies are very tight despite
relatively high carcass weights for this time of year. Hog slaughter for
the week was reported to be 7.3% lower than the previous year andeven with the gains in carcass weights, total production for the weekwas down 6.8%. Note that carcass weights for the last two weeks areconsidered provisional and we will see if USDA goes backs and revises
them lower, which was the case earlier in July. On the one hand, hot
and humid weather should contribute to lower weights especially as
temperatures in key production areas are higher than a year ago. However, we suspect that very strong pork prices have encouraged
producers to be very aggressive in feeding animals and maybe hold them on feed a bit longer. After all, hog slaughter since
June 1 (latest Hogs and Pigs report date) has been on average 4.6% lower than a year ago. Based on the USDA hogs and pigs inventory
numbers, slaughter for the period in question should have been around 3% lower than the previous year.
on the other hand remain well below year ago levels and also below the five year average. It is understandable that with more
cows in the slaughter mix weights will be lower but the magnitude of the decline points to a more dramatic change in both the cattle
being placed on feed as well as feed rations and rate of weight gains.

Vol. 8, No. 147 / July 30, 2010

810
DRESSED CARCASS WEIGHT, ALL CATTLE, POUNDS
Data through Week Ending July 31, 2010
800
790
780
770
760
740
750
Jan Feb Mar Apr May Jun Jul Aug
2005-09 Avg.
Sep Oct
2009
Nov Dec
2010
206
DRESSED CARCASS WEIGHT, ALL HOGS, POUNDS
Data through Week Ending July 31, 2010
204
202
200
198
194
196
Jan Feb Mar Apr May Jun Jul Aug
2005-09 Avg.
Sep Oct
2009
Nov Dec
2010
Cattle weights,

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Disclaimer: The Daily Livestock Report is intended solely for information purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade any
commodities or securities whatsoever. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are
attempted. Futures trading is not suitable for all investors, and involves the risk of loss. Past results are no indication of future performance. Futures are a leveraged investment, and because only a percentage of a contract’s
value is require to trade, it is possible to lose more than the amount of money initially deposited for a futures position. Therefore, traders should only use funds that they can afford to lose without affecting their lifestyle.
And only a portion of those funds should be devoted to any one trade because a trader cannot expect to profit on every trade.

CME Group is the trademark of CME Group, Inc. The Globe logo, Globex® and CME® are trademarks of Chicago Mercantile Exchange, Inc. CBOT® is the trademark of the Board of Trade of the City of Chicago. NYMEX,
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Page 2

Vol. 8, No. 147 / July 30, 2010

PRODUCTION & PRICE SUMMARY Week Ending 7/31/2010

Item Units Last Week Prior Week Pct. Change Last Year Pct. Change 2010 YTD
Y/Y %
Change
31-Jul-10 24-Jul-10 1-Aug-09
C
A
T
T
L
E
FI Slaughter
FI Cow Slaughter **
Avg. Live Weight
Avg. Dressed Weight
Beef Production
Thou. Head
Thou. Head
Lbs.
Lbs.
Million Lbs.
654
120
1281
772
503.4
666
101
1281
770
511.5
-1.80%
18.34%
0.00%
0.26%
-1.58%
641
116
1288
786
500.7
2.04%
3.28%
-0.54%
-1.78%
0.54%
19,433
3,491
1,272
766
14,822
1.3%
4.0%
-1.4%
-1.9%
-0.7%
Live Fed Steer Price
Dressed Fed Steer Price
OKC Feeder Steer Price
Beef Cutout Value
Hide/Offal
$ per cwt
$ per cwt
619-700 Lbs.
619-900 Ch.
$/cwt
92.87
147.85
97.00
154.01
10.55
94.79
150.44
96.04
154.94
10.65
-2.03%
-1.72%
0.99%
-0.60%
-0.94%
82.10
131.35
97.58
142.53
8.23
13.12%
12.56%
-0.59%
8.05%
28.19%
H
O
G
S
FI Slaughter
FI Sow Slaughter **
Avg. Dressed Weight
Pork Production
Thou. Head
Thou. Head
Lbs.
Million Lbs.
1,949
56.4
202.0
392.9
1,955
51.9
202.0
394.2
-0.31%
8.59%
0.00%
-0.33%
2,103
64.6
201.0
421.7
-7.33%
-12.74%
0.50%
-6.83%
61,624
1,633
203
12,520
-4.0%
-6.7%
0.1%
-4.0%
Iowa-S. Minn. Direct
Natl. Base Carcass Price
Natl. Net Carcass Price
Pork Cutout
Wtd. Avg.
Wtd. Avg.
Wtd. Avg.
185 Lbs.
80.85
78.69
81.38
88.43
78.08
75.40
78.04
83.83
3.55%
4.36%
4.28%
5.49%
54.94
59.13
61.29
60.85
47.16%
33.08%
32.78%
45.32%
C
H
I
C
K
E
N
Young Chicken Slaughter *
Avg. Weight
Chicken Production
Eggs Set
Chicks Placed
Million Head
Lbs.
Million Lbs.
Million
Million Head
166.6
5.50
916.5
208.3
169.4
163.0
5.55
904.8
208.8
173.8
2.22%
-0.90%
1.30%
-0.23%
-2.53%
160.7
5.48
880.9
201.4
167.0
3.67%
0.36%
4.05%
3.44%
1.45%
4,642
5.57
25,855
6,207
5,104
2.4%
1.4%
3.8%
1.7%
0.7%
12-City Broiler Price
Georgia Dock Broiler Price
Composite
2.5-3 Lbs.
82.14
86.91
85.38
87.08
-3.79%
-0.20%
79.32
87.12
3.56%
-0.24%
T
U
R
K
Young Turkey Slaughter *
Avg. Weight
Turkey Production
Million Head
Lbs.
Million Lbs.
4.567
28.46
130.0
4.606
28.86
132.9
-0.85%
-1.39%
-2.22%
4.863
28.17
137.0
-6.09%
1.03%
-5.12%
125.605
29.70
3,730
-4.4%
1.8%
-2.7%
Eastern Region Hen Price 8-16 Lbs. 95.17 93.50 1.79% 81.20 17.20%
G
R
A
I
N
Corn, Omaha
DDGs, Minnesota
Wheat, Kansas City
Soybeans, S. Iowa
Soybn Meal, 48% Decatur
$ per Bushel
$ per Ton
$ per Bushel
$ per Bushel
$ per Ton
3.58
94.00
5.62
10.49
329.90
3.37
96.00
5.06
10.47
325.20
6.23%
-2.08%
11.07%
0.19%
1.45%
3.20
73.50
5.34
11.18
383.80
11.88%
27.89%
5.24%
-6.17%
-14.04%

* Chicken & turkey slaughter & production are 1 week earlier than the date at the top of this sheet.
** Cow and sow slaughter reflect levels from two weeks ago due to reporting lag.
Disclaimer: The Daily Livestock Report is intended solel for information purposes and is not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade any
commodities or securities whatsoever. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are
attempted. Futures trading is not suitable for all investors, and involves the risk of loss. Past results are no indication of future performance. Futures are aleveraged investment, and because only a percentage of a contract’s
value is require to trade, it is possible to lose more than the amount of money initially deposited for a futures position. Therefore, traders should only use funds that they can afford to lose without affecting their lifestyle. And
only a portion of those funds should be devoted to any one trade because a trader cannot expect to profit on every trade.

CME update



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KCBT for July

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KCBT update

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ThePorkNetwork.com
Monday, August 2, 2010

Quotes Weather Video


In This Issue:

Doane Market Outlook: Hogs
Editorial: Chipotle Claims Its Food Has Integrity
Business Insights: Hog Futures Near 3-Month Highs As Tight Supplies Push Belly Prices To Record
Vietnamese Swine Producers Shopping In Nebraska
Farm Aid To Mark 25th Anniversary In Milwaukee
Study Claims Conventional Ag Limits Greenhouse Gas
U.S. Department Of Agriculture & DuPont Collaborate On New Test For Hard To Detect Foodborne Pathogens
Indiana State Fair's 'Year Of Pigs' Begins Friday
Report: Commitment Of Traders Grain
Video: China's Meat Consumption
Weather: Extreme Heat Grips Plains, Dry In The West
Doane Market Outlook: Hogs
Lean hog futures were higher on Monday. The October through April 2011 contracts set new highs today. Strength in pork prices last week, the rally in the stock and weakness in the dollar were supportive factors. The firm pork prices have helped benefit packer margins and cash trade was steady to higher on Monday morning. October ended 58 cents higher at $79.60 and December was 30 cents higher at $75.70.

Market Outlook Resource Center


Featured Article


Colleen Scherer
Managing Editor-
Ag Professional


Chipotle Claims Its Food Has Integrity
Chipotle recently unveiled a newly designed Web site in July that now features the company’s supply chain. The new site is the company’s newest marketing strategy to show its customers where their food comes from before it arrives at Chipotle.
More...



Business Insights

Hog Futures Near 3-Month Highs As Tight Supplies Push Belly Prices To Record
Hog futures climbed to the highest level in nearly three months today as a Midwest heat wave curbs shipments of slaughter-ready pigs, tightening pork supplies and sending pork belly prices to a record.
More...




More Articles

Vietnamese Swine Producers Shopping In Nebraska
Some of the largest swine producers in Vietnam are in Nebraska this week to learn more about genetics and feed and to possibly buy the products.
More...

Farm Aid To Mark 25th Anniversary In Milwaukee
Board Members Willie Nelson, John Mellencamp, Neil Young and Dave Matthews to headline Oct. 2 all-star music and food festival
More...

Study Claims Conventional Ag Limits Greenhouse Gas
Advances in conventional agriculture have dramatically slowed the flow of greenhouse gases into the atmosphere, in part by allowing farmers to grow more food to meet world demand without plowing up vast tracts of land, a study by three Stanford University researchers has found.
More...

U.S. Department Of Agriculture & DuPont Collaborate On New Test For Hard To Detect Foodborne Pathogens
DuPont and the U.S. Department of Agriculture have agreed to collaborate on the development of a new test for detecting hard-to-identify strains of toxin-producing E. coli that are not currently regulated and have been causing increased instances of food contamination and illness.
More...

Indiana State Fair's 'Year Of Pigs' Begins Friday
The Indiana State Fair's "Year of Pigs" will begin on Friday, drawing its theme from a state pork industry that's the fifth largest in the nation
More...

Cattle Network News.

Jolley: Five Minutes With Fred Casinelli – President & Chief Operating Officer, Sysco-Boston

Saturday, July 31st


Sysco is a major player in the food service business – maybe the ‘majorest’ player. I remember the concern that rippled through the meat processing business a few years ago when Sysco was on a major buying spree. They wanted to buy the best regional purveyors around the U.S. and they were willing to pay a nice sum for the privilege. Full Story...


--------------------------------------------------------------------------------


Are We Sending The Right Messages?
Fifty-seven percent of Americans perceive themselves to be overweight, says the new 2010 Food & Health Survey: Consumer Attitudes Toward Food Safety, Nutrition & Health, commissioned by the International Food Information Council Foundation. This fifth annual national quantitative study, designed to gain insights from consumers on important food safety, nutrition, and health-related topics, also indicates that based on respondents’ body mass index, one-third are obese, one-third are overweight and about one-third are ideal. Full Story...



How Would Stopping Illegal Immigration Impact Agriculture?
With the federal government beginning its challenge of the Arizona immigration law last week, the employment of illegal immigrants in agricultural jobs gained momentum again.

One estimate is that there are more than 13 million illegal immigrants living in the United States today. That is an amazing number when you consider this is about the population of the state of Illinois. Another way of explaining the number is that this is almost 5 percent of the population of the United States. Full Story...



Jolley: NCBA vs. CBB vs. State Federations – Can’t We All Just Get Along?
The folks at NCBA convened a press conference early this morning. It was called late in the day yesterday. A bunch of reporters showed up bright and early at 8:00 AM Denver time to listen to Forest Roberts, Scott George and Steve Fogelsong give a calm and reasoned response to CBB’s recent allegations. Full Story...



--------------------------------------------------------------------------------


More Articles
Schwieterman: Strong Bounce Revives Cattle Futures, Corn & Wheat Futures Higher
Young Producer Leaders Help Shape The Future Of The Industry
BeefTalk: Feeding Cattle Adds Balance To The Cow-Calf Operation
El Paso Settlement Agreement Threatens Ranchers’ Public-Lands Grazing Rights
What Women Want
Illinois Farmer Lends A Hand As Flood Waters Reach Cattle
South Texas Flood Damages At $40 Million & Climbing
Cow Death Prompts Call For Emergency Protocol

United Organizations of the Horse Press Release


FOR IMMEDIATE RELEASE

July 31, 2010




Contact:


Sue Wallis

307 680 8515 cell

307 685 8248 ranch


sue.wallis@unitedorgsofthehorse.org




National Conference of State Legislatures (NCSL) adopts new policy resolution calling for USDA inspection of horse meat.





The policy resolution was passed at the annual Legislative Summit held in Louisville, Kentucky on July 25-28, 2010. The policy was first reviewed and passed by the Agriculture and Energy Committee, and then passed at the Business Meeting of the 45 states in attendance. Policies which receive a super majority vote of more than 3/4 of the states attending give NCSL staff in Washington, D.C. the authority to lobby Congress on behalf of the position of the states.


USDA ante-and post mortem inspections are mandatory if an animal is to be sold as meat, and the animal must be slaughtered in a USDA-inspected facility. Federal appropriations law contains a prohibition on allowing federal dollars to be spent on salaries for inspectors who inspect horses before or after slaughter, making it impossible for operations that want to process horse meat within their borders to market this meat. Inspectors also cannot respond to a voluntary, fee-based inspection request to inspect horse meat. The National Conference of State Legislatures (NCSL) believes that these provisions unduly restrict states' action regarding horse slaughtering facilities within their borders. Therefore, NCSL calls upon Congress to remove these restrictions in existing law, and not insert similar provisions in subsequent appropriations bills or other legislative vehicles.



The closing of horse slaughter facilities in America has decimated the equine industry, and has curtailed the ability of states and tribes to control the numbers of excess and abandoned horses on their lands. Documented reports indicate an increase of 400% in the number of starved, abandoned, and neglected horses between 2008 and 2009 alone. This has resulted in unprecedented state budget increases and taxpayer costs at a time when states cannot afford unnecessary expense. It has severely impacted the livestock industry as a whole, and by eliminating the salvage value of horses has significantly reduced the market value of all horses. The loss of markets for horse meat for pet food, for the maintenance of zoo animals, and for byproducts has greatly impacted these sectors. The loss of horse products for export has eliminated more than

$42 million dollars of direct income for an already struggling sector of the livestock industry, not to mention millions of dollars in indirect costs because of the loss of value of individual animals. Given the current state of the horse processing industry, it is particularly important that the federal government not restrict access to inspection.






-End-