Coronavirus Surge Tests Safeguards for Meatpacking Workers
Surging coronavirus cases in major meat-producing states are testing safeguards that the U.S. meat industry has implemented to protect employees and their meat production after a wave of infections forced widespread plant shutdowns in April.
New Covid-19 infections in recent days have jumped to a record level in Georgia, the largest chicken-producing state, with similar surges in other big poultry-producing states including Arkansas, Alabama and North Carolina. Rapid growth in new cases is raising fears among some employees that they remain at risk at work.
Production in the $213 billion U.S. meat industry over the past few weeks has returned to normal levels, as companies including Tyson Foods Inc., Cargill Inc., Smithfield Foods Inc. and JBS USA Holdings Inc. ramped up processing lines and ran extra shifts on weekends. For the week ended June 27, beef production ran 5% higher than the same period a year ago, and pork production jumped nearly 14%, according to the U.S. Department of Agriculture. Chicken production fell about 2%. Beef- and pork-plant employees were hit hardest by the spring wave of infections.
One-Third of Coronavirus Ag Payments Out -- Market Talk
12:40 ET - The USDA says roughly $4.9B in payments have been paid out through the $16B allocated to the Coronavirus Food Assistance Program. Of that $4.9B, $2.4B has been paid to livestock producers, $1.3B has been paid to nonspecialty crop producers, $1B has been paid to dairy producers and $113M has been paid to specialty crop producers, the American Farm Bureau says. Grain futures have rebounded as states attempt to reopen following the worst of the coronavirus pandemic, but reports of cases have ticked higher in recent days. (firstname.lastname@example.org; @kirkmaltais)
UN FAO: Food Prices Rise for First Time This Year
Global food prices rose in June for the first time this year, the United Nations' Food and Agriculture Organization said Thursday, suggesting that the sharp declines experienced by food commodities as the coronavirus has hit demand could be easing.
The UN FAO's monthly food price index, which tracks a basket of the most common foodstuffs such as grains, vegetable oils and meat, rose 2.4% in June to 93.2.
STORIES OF INTEREST
AB Foods Has Cushion Against Uncertainty -- Market Talk
1028 GMT - Associated British Foods is well-placed despite economic jitters and lower sales at fashion retailer Primark, Hargreaves Lansdown says. Primark's third-quarter sales fell dramatically, but trading in the first few weeks of June looks promising, HL says. Meanwhile the group's food business has improved margins and benefited from consumers eating more at home. "While we see the recent performance as strongly positive, there's still a long way to go," HL's Nicholas Hyett says. "We still worry about the state of the global economy and what that could mean for all retailers in the medium term. Given those concerns, ABF's substantial cash pile is very welcome." Shares rise 5.4%. (email@example.com)
Live-Cattle Futures Close Higher Ahead of Holiday Weekend -- Market Talk
13:57 ET - Live-cattle futures on the CME rise 2.2% at 99.4 cents a pound. The recovery of the cattle industry after the Covid-19 pandemic has come a long way since April, but still has a way to go, according to Steiner Consulting. "Slaughter at major processing plants has normalized, helping resolve some of the supply chain bottlenecks that developed in late April and May," the firm says. "However, beef features for the most current week were still about 40% lower than the same time last year." Lean-hog futures, meanwhile, fall 0.1% to 49.05c. The CME will be closed tomorrow in observance of Independence Day and will reopen Monday. (firstname.lastname@example.org; @kirkmaltais)
Estimated U.S. Pork Packer Margin Index - Jul 2
Date Standard Margin Estimated margin
Operating Index at vertically -
Jul 2 +$ 77.68 +$ 10.16
Jul 1 +$ 69.96 +$ 3.68
Jun 30 +$ 67.36 +$ 1.34
* Based on Iowa State University's latest estimated cost of production.
A positive number indicates a processing margin above the cost of production of the animals.
This report compares the USDA's latest beef carcass composite
values as a percentage of their respective year-ago prices.
For Today Choice 93.7
(Percent of Year-Ago) Select 101.7
USDA Boxed Beef, Pork Reports
Wholesale choice-grade beef prices Thursday rose 6 cents per hundred pounds, to $205.44, according to the USDA. Select-grade prices rose 33 cents per hundred pounds, to $198.76. The total load count was 156. Wholesale pork prices rose $3.01, to $66.46 a hundred pounds, based on Omaha, Neb., price quotes.