So much for Friday’s reprieve in the futures market, Cattle futures sank on Monday, along with other commodities and equities as traders digested news that China was increasing tariffs on U.S. products in retaliation for the added levies imposed by the U.S. last week.
Live Cattle futures closed an average of $1.81 lower (85¢ lower at the back to $2.70 lower in spot Jun).
Feeder Cattle futures closed an average of $3.11 lower.
Wholesale beef values were firm to higher on moderate to good demand and light to moderate offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 47¢ higher Monday afternoon at $221.58/cwt. Select was $1.43 higher at $208.89.
Corn futures closed mostly 2¢ to 5¢ higher through Jul ’20 and then mostly fractionally mixed.
Soybean futures closed 3¢ to 6¢ lower through Sep ’20 and then mostly 1¢ lower.
Major U.S. financial indices closed sharply lower Monday on China’s retaliation to additional tariffs levied by the U.S. late last week.
The Dow Jones Industrial Average closed 617 points lower. The S&P 500 closed 69 points lower. The NASDAQ was down 269 points.
Although U.S. pork exports continue to bear the brunt of ongoing trade issues between the U.S. and other countries, those issues are impacting U.S. beef exports, too.
Beef exports in March of 107,655 metric tons (mt) were 4% less year-over-year, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). Value was 2% less at $678 million.
For the first quarter, exports were down 3% at 307,306 mt valued at $1.9 billion (down 0.8%).
For perspective, U.S. pork exports of 211,688 mt were 7% less year over year in March and export value was 15% less at $520.7 million. For the first quarter, pork exports were 6% less than last year for volume and 14% less in value at $1.47 billion.
U.S. beef export value per head of fed slaughter for the first quarter was $309.32, which was 2% less than the same quarter last year.
South Korea continues to be the growth leader for U.S. beef exports, according to USMEF. First-quarter exports to South Korea were 8% more year over year at 56,173 mt. Export value of $414.2 million was 13% above last year’s record-shattering pace.
First-quarter exports to Japan were higher year over year for both tonnage and value, but were less in March.
“U.S. beef cuts are still subject to a 38.5% tariff in Japan while our competitors’ rate is nearly one-third lower at 26.6%,” explained Dan Halstrom, USMEF president and CEO. “This really underscores the urgency of the U.S.-Japan trade negotiations, which must progress quickly if we are going to continue to have success in the leading value market for U.S. beef and pork.”
Japan’s tariffs on beef variety meat are lower, but U.S. shipments are subject to a duty of 12.8% while competitors pay less than half that rate.