Livestock industry margins were mostly lower last week as rising input costs crimped the profitability outlook. Declines were greatest for feedlot placements, where margins fell over $50/head due to higher feeder cattle costs. Beef packer margins saw the next greatest declines with profits dropping $35/head and hitting their lowest level since WPI started estimating packer margins in 2010. The decline in beef packer margins came amid last week’s $5-8/cwt rally in fed cattle prices that was partly offset by a $5 gain in beef values. The rally in fed cattle prices helped push feedlot closeout margins sharply higher, however, and to near five-year record highs. The pork sector saw packer margins decrease slightly on weaker pork val...
Key Market Insights Geopolitical Limbo: Geopolitical risk remained a key driver across global commodity markets today. President Trump stated that the Iran memorandum of understanding is not yet final and warned that military action could resume if negotiations fail. Both sides continue w...
Key Takeaways: Drought remains a major threat to global agricultural production, particularly in regions with limited rainfall and growing water scarcity. Commercially available drought-tolerant traits in corn, soybeans, and wheat have generally delivered modest yield improvements, limiting th...
Key Takeaways: Peace at last in the Persian Gulf? Over the weekend, the U.S. announced and Iranian officials confirmed a peace agreement, with formal ratification set for Geneva on 19 June. The announcement means the Strait of Hormuz is set to reopen fully and toll-free within 30 days.&n...
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.