Cattle futures closed limit-lower amid light trade and declining open interest and pressured by mounting concerns about beef packing production amid COVID-19 (see below).
Live Cattle futures closed limit-down $3.00
Feeder Cattle futures closed limit-down $4.50.
Wholesale beef values were higher on good demand and moderate to heavy offerings, according to AMS.
Choice boxed beef cutout value was $1.93 higher Monday afternoon at $225.86/cwt. Select was $3.07 higher at $211.40.
Corn futures closed mostly fractionally lower.
Soybean futures closed 5¢ to 9¢ lower through Mar ’21 and then mostly 2¢ to 3¢ lower.
Major U.S. financial indices closed mixed on Monday, amid another volatile day of trade. On the one hand, investors continued to show optimism concerning COVID-19 progress. On the other, there’s plenty of wariness as quarterly corporate earnings season ramps up.
The Dow Jones Industrial Average closed 328 points lower. The broader S&P 500 closed 28 points lower. The NASDAQ closed 38 points higher.
JBS closed its Greeley, CO plant on Friday for a deep cleaning, and will be closed for two weeks, according to the Colorado governor’s office. With the information available at the time, Cattle Current reported yesterday JBS intended to be closed for two days this week.
According to a statement, “The Colorado Department of Public Health and Environment (CDPHE) and Weld County Public health are working with JBS to design an aggressive testing and containment strategy, so they can continue their critical work which ranchers and consumers rely on. Gov. Polis has prioritized the Colorado National Guard to provide logistical support for testing so the plant can safely start up again.”
“The U.S. meat industry faces unprecedented threats as COVID-19 sweeps through labor forces at meat processing facilities nationwide,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Production of beef, pork and poultry are simultaneously threatened as COVID-19 infections affect labor availability and processing capacity in multiple facilities across all meat industries. Reduced processing capacity could cause backups in live animal supplies if animals cannot be processed in a timely fashion. The severity of impacts will depend on specific situations and locations but could include costly delays in holding animals until slaughter, backlogs in production facilities, or even disposal of animals.”
Peel points to last week’s estimated cattle slaughter as an indication that production was already beginning to slow. USDA estimated slaughter for the week ending Apr. 11 at 536,000 head, which was more than 14% less than the previous week and almost 16% less than the same week last year, according to Peel. Fed cattle slaughter was down, as was cow and bull slaughter.
“This predicament could result in a situation not previously seen in the beef industry,” Peel says. “It may simply not be possible to slaughter animals in a timely manner. Last summer, the loss of a single packing plant in Kansas resulted in relatively little decrease in overall cattle slaughter as production was shifted to other plants; increased Saturday slaughter largely offset the loss of the fire-damaged plant. In the current situation, closure or reduced chain speeds across multiple plants may make it impossible to keep up with slaughter.”