Howell: This is the Friday, January 4, 2019
version of the Market Plus segment.
Joining us now is Sue Martin.
Sue, welcome back.
Martin: Thank you, Delaney.
Howell: Well, Sue, we certainly have a lot to
touch on here that we teased in the regular
portion of the show but I want to start out here
first with hogs.
This week we had, or the latest case, outbreak of
African Swine Fever was almost 100,000 head herd
culled, completely culled.
What size herd, does a size herd like that have
enough impact in China's hog markets to have them
turn to the U.S.
for hog production or for pork?
Or is that still something that we need to continue
to watch?
Martin: Well, I think first off China is the
world's largest producer of pork, they own half of
the hogs in the world and they still import.
And they're going into their Lunar New Year,
which is February 5th, and so pork is one of the
staples for the holiday season along with veg oil
to do cooking.
I think what is happening is it's such an important
item because the size of this facility that it
broke out in, I think it was in Heilongjiang that
it happened in, is one of the largest yet that it
has showed up and it has been found in almost
everywhere there's hogs in the country.
And so it's a big, big situation.
So the Chinese government came out with regulations
late this week and stated that any hog in a
facility, they have to, now they process hogs all
from each section of the country in that facility.
They have to, they cannot intermix different
provinces and they have to do blood testing, they
have to draw blood and if this shows the virus, the
hogs are of course they're culled anyway or
processed, but the meat cannot go into the
consumer chain, it has to be destroyed.
The packing house will be closed for two, 48 hours,
so for two days.
I think it shows how concerning the situation
really is because the virus lives outside the
host for a very long time.
And it is being spread even by the movement of
the meat.
And so it is a very big concern.
Meat and bone meal or blood meal so to speak,
they found it in that, and -- Howell: They found it
in feedstuffs too I think this week.
Martin: Yes, and that was being put into feedstuff
and so that is having to be pulled away because
they cannot prove if it's not there or it is.
So I think when we look at what is happening in China
it's a big, big deal and it's one that they can't
hardly get their arms around.
It's going to take I'm going to guess three years
at least to get their arms around this and even then
it might take longer.
So what is going to happen is in the meantime even
though African Swine Fever virus does not affect
humans it is the thought process, the psychological
process of thinking about it and being concerned.
So Chinese people are starting to back away from
their local or domestic product.
And so importing pork is probably going to be a big
thing.
They can pull pork from Europe, they can get it
from Russia, although Russia has African Swine
Fever as well.
And they can get it from Ukraine.
But at the end of the day we have Smithfield Farms
here that is owned by Shuanghui and so they can
get product from there and move it over.
But I think it's not only bullish to hogs but I
think it's more bullish to beef because they'll
switch.
Howell: You're saying the Chinese consumers
switching to beef instead or pork?
Martin: Beef, exactly.
And they'll eat cuts that we don't eat like tripe
and different things.
But I think they'll make that switch and once they
get a taste for that.
The thing we have to keep in mind is China has the
world's largest, not world's largest middle
class because India has that, but it has the
world's fastest growing middle class and that is a
draw for meat proteins.
And so it will probably help with fish and chicken
but more so I think it's going to be the beef
market that really gets attracted.
And of course they have already made deals with
JBS out of Brazil and of course JBS has packing
houses here as well.
And so I think it's going to be that exports of beef
are going to continue to be very good and the
demand.
But there's one other thing that I think is
affecting the meat markets that is really not given
enough credit to and I've kind of talked on it once
I think on the show a long time ago but it's the
immigration, the movement of people around the world
moving from the Middle East into Europe and
through European countries, moving from
Central America into the U.S.
These people if you look at the migration yes
there's women in children in it but the majority is
the young men, they like protein and meat and I
think that has made a big change on all this demand
for meat in our global market.
Howell: Interesting.
Yeah the immigration factor isn't one we
commonly hear.
So I'm glad you brought that up.
I think the other thing we teased during the show
here a little bit was rice which is also a huge
staple to the Chinese diet and I'm guessing that is
why we've seen people import so much or why
we've seen China recently import rice.
We've got a question from Rich in Appleton,
Wisconsin, who specifically asks that,
Sue.
He said, why did China buy our rice and what U.S.
areas benefit from this purchase?
Martin: Well, you'll have areas like in the South
and also out of towards California that has rice.
But I think rice what is so important about it, one
it is a market for our rice growers that they
didn't have and so that's a good thing.
But more importantly it just shows a continued
draw, a tightening of supplies globally and here
in the U.S.
as we continue to tighten our coarse grain supplies,
stocks to usage is very tight, corn and wheat is
coming down and I think once we start getting into
the spring and we find out how low the acres are on
hard red winter wheat and maybe even the soft red
but especially the hard red, I think we're going
to find again that rice going out the door to
another export market is also another way of
tightening our supplies again between coarse
grains and interchangeable markets that we have.
It's a bullish thing.
Howell: Yeah, I understand.
What about, we talked also a little bit there, has
South American weather, Brazil and Argentina, has
it been priced into the soybean markets?
You said, refresh us.
Martin: I think we have to some degree because we've
been lifting, this week especially we have been
lifting on the talk of weather and even wheat
kind of got some of that too because of Argentine
weather being so wet and while the Buenos Aires
Grain Exchange has not lowered their estimate on
production of wheat, which is like 19 million metric
tons, you still are hearing talk and rhetoric
about concern that they could be losing another 2
to 3 million metric tons of that 19 million metric
tons due to quality issues and maybe moving it into
the feed sector.
So that has helped rice, or I mean wheat, kind of
stabilize and get a little lift here too.
But for corn I think it's still a factor to come.
And so as we move through the latter part of this
month they are forecast to continue to be dry.
And the temperatures are more seasonably but
they're running in the upper 80s, low 90s so
we'll see what happens but I think as we move in
through February it's going to be really key to
be watching how well the crops come out, how the
weather has been because here there has been the
old saying, plant your corn in the dust and your
bins will bust.
Does that ring true for Brazil?
I'm not sure.
But I will say the safrinha crop they had
high hopes for that.
They might find that they're over optimistic on
that crop.
They are too which just adds another little
support under our market.
Howell: Sue, we've got a couple of questions and
I'm going to skip down on the list here because we
don't usually get questions about cattle so
we've got a couple of great questions I want to
get your thoughts on before we wrap up here.
We've got Ryan in Dike, Iowa.
He said, August live cattle, should we buy puts
now or just let her ride?
Martin: I think I would, we have so much going on
in the world, and we had a break here, we have timing
for a low on Monday in the cattle and that is hinted
more towards feeders and fats but up toward the
front contracts.
But I think what is going to happen is because there
are indicators on the longer term like the
weeklys are so negative that we're going to get a
bounce in the market and I think the trade has now
got attention that they were bullish and all of a
sudden now they're thinking ooh, this market
doesn't feel the same as it did, we better start
hedging and they're going to kind of cap those
rallies.
So I think what I would do with the stock market
rolling like it is and talk about global
economies being concerning of which I think
currencies is one of the things they're going to be
addressing in their talks with trade between the
U.S.
and China.
But I think it's probably a prudent thing to buy
some puts, that way you've got yourself floored and
you leave that top side open because I'm very
friendly cattle for this year.
Like I said, it's one of my favorite markets for
2019.
Howell: And I think that sums it up nicely here for
our last question.
Jon in Chilton, Wisconsin said, do you deem it
necessary for the live cattle and feeder cattle
markets to move in unison or can they operate
independently of each other?
And what do you see for this year?
Martin: Well, they can operate independently but
this past year, for example, feeders led the
way up and they led the way down and back up and
back down.
They have been a bigger mover.
I think when we look at this next year the
indicators that I have on cattle work very well on
cattle and they're looking at the quarterly data,
this is one of the reasons I'm very positive is
they're just getting a nice go, both fats and
feeders.
I think feeders, when we look at the cow slaughter
we've had this past year and we look at, and I
think cattle have been counted twice to some
degree in our reports, but when we look at the
feeders and the bitterly cold weather, so far we've
had these weather patterns hit in cattle country and
I think that's going to really continue.
Once we start those patterns they seem to stay
and I'm looking at this weather, I love what we
have going right now, but I'm afraid it's not here
to stay and when we start to turn back bitterly cold
the blast could be that polar vortex air coming
back out of Canada, I fear that the cattle aren't
going to be putting the weight on like they
should, which adds to more feed usage, but I think
the demand for feeder cattle is going to be good
this next year.
I think feeders are going to surprise us how high
they get.
Howell: All right.
How high, Sue?
How high are you thinking?
Martin: Well, they got up in the 150s this last
year.
I'm thinking, first off, I think fats will go through
130 and I think the feeders will probably have
a potential to get up around 170, 175.
Howell: Oh wow.
Okay.
Sue Martin, thank you so much.
Martin: Thank you.
Howell: Join us again next week when we'll explore
how one group of farmers are growing crops without
sunlight and Darin Newsom will join me at the Market
to Market table.
Until then, thanks for watching, listening or
reading.
I'm Delaney Howell.
Have a great week!
For more infomation >> Plus belle la vie résumé de l'épisode 3707 - Duration: 3:06. 
For more infomation >> Plus belle la vie en avance : Coralie jalouse ? - Duration: 0:56. 
For more infomation >> LA PLUS GRANDE LIBRAIRIE D'OCCASION D'ÎLE-DE-FRANCE (LIBRAIRIE DE L'AVENUE) - Duration: 5:02. 
For more infomation >> Plus belle la vie : Jean-Paul célibataire, Luna victime de chantage, Sacha et Victoire vivants - Duration: 3:32. 
Không có nhận xét nào:
Đăng nhận xét