TOP STORIES
Recovering Chinese Hog Population Fuels Soybean Need -- Market Talk
0905 ET - China's recovery from the devastation to his hog herds by African swine fever appears to be progressing faster than expected by market observers, says Joe Stone, head of Cargill's agricultural supply chain division. Speaking on a virtual forum held by the US Soybean Export Council on Wednesday, the company's feed customers in China are in "expansion mode," and Cargill sees China's demand for US soybeans more linked to higher consumption than stockpiling - something China is known to do. "Chinese demand is strong, Chinese demand is real, and I think it's a real positive for our grain markets over the next 12-24 months," says Stone. Grains on the CBOT are higher in pre-market trading Wednesday. (kirk.maltais@wsj.com; @kirkmaltais)
STORIES OF INTEREST
US Ethanol Inventories Drop For First Time in Months -- Market Talk
1119 ET - Inventories of ethanol in the US have posted a drop this week, the first time since October that they've done so. According to data released by the EIA, ethanol inventories totaled 23.28 million barrels, which is down 220,000 barrels from last week. Meanwhile, ethanol production rose slightly this week, up 1,000 barrels per day to 935,000 barrels per day. After weeks of rising inventories and stalling weekly production figures, this week's report may be considered bullish among grains traders hoping to see ethanol fuel consumption pick back up. (kirk.maltais@wsj.com; @kirkmaltais)
Agri-Food System Needs Revolution to Fight Hunger, Meet Climate Goals -- Market Talk
1117 GMT - Agriculture, forestry and other land use make up around a quarter of the world's greenhouse gas emissions, Morgan Stanley says. However, the agri-food system will need to simultaneously deliver around 50% more food to eliminate malnutrition for 2.5 billion people and cut roughly 13 gigatons of emissions to meet the goals of the Paris Agreement by 2050, analysts at the U.S. bank say. Some "solution stocks" that can help reinvent the system are plant-based food maker Kerry Group, methionine producer Bluestar Adisseo, plant-protection seller Nufarm, agriculture equipment maker Deere and animal drug maker Elanco, they note. (dieter.holger@wsj.com; @dieterholger)
FUTURES MARKETS
Livestock Futures Finish Lower -- Market Talk
15:05 ET - After starting higher Wednesday, CME livestock futures turned lower to close out trading Wednesday. Lean hog futures made the biggest swing, starting trading higher Wednesday before sinking to a close of 69.775 cents per pound, down 1.6% today. "The huge premium of February to the cash market has helped to spark some selling," says RJO Futures. The big swing continues the volatility seen in hog futures to start the year. Meanwhile, live cattle futures finished down 0.1% to $1.15 per pound. (kirk.maltais@wsj.com; @kirkmaltais)
CASH MARKETS
Estimated U.S. Pork Packer Margin Index - Jan 6
All figures are on a per-head basis.
Date Standard Margin Estimated margin
Operating Index at vertically -
integrated operations
Jan 6 +$ 44.96 +$ 32.33
Jan 5 +$ 42.29 +$ 33.58
Jan 4 +$ 49.13 +$ 33.81
* 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.
Beef-O-Meter
This report compares the USDA's latest beef carcass composite
values as a percentage of their respective year-ago prices.
Beef
For Today Choice 97.9
(Percent of Year-Ago) Select 94.8
USDA Boxed Beef, Pork Reports
Wholesale choice-grade beef prices Wednesday fell 63 cents per hundred pounds, to $205.27, according to the USDA. Select-grade prices fell 41 cents per hundred pounds, to $196.08. The total load count was 204. Wholesale pork prices fell 58 cents, to $75.44 a hundred pounds, based on Omaha, Neb., price quotes.
(END) Dow Jones Newswires
01-06-21 1737ET
