World Perspectives
livestock

Livestock Industry Margins

Beef packer margins improved for a second consecutive week but remained firmly negative. Margins rose $70/head to –$179 as the Choice cutout advanced $4.56/cwt and fed cattle prices were largely stable. The recovery narrowed the gap between breakeven and cash cattle values to roughly $19/cwt, down from more than $26/cwt the prior week. While the improvement reflects modest stabilization in boxed beef demand, margins remain structurally pressured, and packers continue to face downside risk if the seasonal demand and pricing slump arrives as expected in February.  Feedlot placement margins improved meaningfully last week but ...

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livestock

Grassley and Smith Introduce Meat Industry Consolidation Bill

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From WPI Consulting

Communicating importance of value-added products

Facing increasing pressure to quantify the value of export promotion efforts to investors, a U.S. industry organization retained WPI to develop a quantitative model that better communicated the importance of exports. The resulting model concluded that value-added meat exports contributed $0.45 cents per bushel to the price of corn, increasing support for that sector’s financial support of WPI’s client. In addition to serving the red meat industry with this type of analysis, WPI has generated similar deliverables for the U.S. soybean and poultry/egg industries.

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