FEEDSTUFFS PRECISION PORK Market Report – October 16

Dave Bauer, senior market analyst for Provimi, offers his
perspective on this week's hog market and recaps the week’s
highlights. He also lists some of the things to think about as
you prepare for the week ahead. 

For the second week in a row, barring any unforeseen issues on
Friday or Saturday, it will put together another solid six days
of slaughter this week reaching near the 2.7 million head level.
Once again, the first four days of the week of average an
impressive 489,000 head, but to finish out the week, Friday's
estimate sits at 482,000 head. Saturday's estimated run, however,
started earlier in the week at 236,000 head and plans as a Friday
morning have now ramped up to 261,000 landing, right at the 2.7
million head for the week, just 1.1% below last week's 2.73
million head. This is a respectable run and depending how you
look at it can be 98% or 96% of normal.


This week's 2.7 million head kill will be 98% of the stated
pre-COVID environment capacity of 2.767 million head, or roughly
96% of the postcode environment average intentions of 2.65
million head. So the 2.7 million estimate for this week reflects
the packer pushing pretty hard and understandably so as there
stated packer margins, if using the simple cutout minus CMI index
projection, estimated $41 per head margin. This compares to the
three-year average for this period of $26 per head. What’s ahead
for producers in terms of margin and profitability? Bauer let’s
us know.


These are uncertain times and it will pay dividends to be
well-prepared. If you have questions on this week’s recap or want
to discuss something not covered, feel free to ASK DAVE
at David_Bauer@cargill.com. Plan today for
tomorrow’s success.


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