Current Cattle Market Daily Headlines for Thursday, October 22, 2020

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Judge denies motion to dismiss turkey price-fixing case

https://www.meatingplace.com/Industry/News/Details/95126

  • Judge Virginia M. Kendall has denied a motion to dismiss a price-fixing case against turkey producers in the Northern District of Illinois.
  • Olean Wholesale Grocery Cooperative and John Gross and Co. filed the lawsuit claiming that Butterball, Cargill, Tyson Fresh Meats, Perdue Foods, Kraft foods and other companies shared “competitively sensitive information” to increase the price of turkeys above normal market standards.
    • Agri Stats Inc. is also a defendant in the case as the plaintiffs allege the company was used to exchange information between the defendants.
  • All the defendants besides Kraft, who filed a separate motion, filed a motion to dismiss the case claiming that the plaintiffs failed to:
    • Allege any agreement among the Turkey Defendants to exchange information.
    • To allege any anti-competitive effects stemming from the alleged information exchange.
    • To allege a properly defined market.
  • Judge Kendall denied the motion stating that the plaintiff’s accusations of information exchange were acceptable and the allegations regarding anti-competitive activity met the initial burden of the court.
    • Judge Kendal did grant Kraft’s separate dismissal motion. The motion argued that Kraft is a turkey purchaser instead of producer and the price manipulations alleged by the plaintiffs would actually end up hurting their bottom line.
  • Over the last week, in separate filings in U.S. District Court in Northern Illinois, The Golden Corral, White Castle and Cracker Barrel Old Country Store have filed antitrust complaints against numerous chicken processors, claiming the processors conspired to restrict production, raise prices and rig bids.
  • Golden Corral’s suit names Pilgrim’s Pride, Claxton Poultry Farms and Georges Inc. as defendants.
  • The Cracker Barrel and White Castle have named Tyson Foods, Pilgrim’s Pride, Koch Foods, Sanderson Farms, House of Raeford Farms, Wayne Farms, MAR-JAC Poultry and several other processors in their complaint.

 

Lions and tigers and new limits, oh my (ShayLe Stewart, DTN Livestock Analyst)!

https://www.dtnpf.com/agriculture/web/ag/blogs/sort-cull/blog-post/2020/10/19/lions-tigers-new-limits-oh?fbclid=IwAR3VyLGPAiZhSwxEaA4-GRdnLePSpLvEoqshYaahZysnF5XN_El-OA5tbZE

  • In August, the CME reported that it would be increasing cattle contract’s daily limits from $3.00 to $4.00/cwt. in the live cattle market. The feeder market would be seeing an increase from $4.50 to $5.00/cwt. Expanded limits for live cattle would go from $4.50 to $6.00 and $6.75 to $7.50 for feeder cattle.
  • As the cattle markets took a dive on Monday, these new limits were experienced for the first time when the November feeder cattle contract closed $4.95 lower.
  • Last week, steer and heifer calves were reported at steady to $3.00 lower as many producers shipped their calves to sale barns.
  • Even though the feeder cattle market and live cattle market trade independently, bearish factors in the live cattle market flooded over into to the feeder cattle market.
  • The current outlooks for feeders and cow-calf producers seems a bit dim considering higher corn prices, lower boxed beef prices and a weaker cash cattle market.
  • The futures market is in place to moderate risk, act as a protection tool and forecast prices at a future date. The CME’s massive limits cause the market to be extremely volatile on a regular day basis, not taking into consideration current fundamentals. This situation leaves our markets vulnerable to daily day-trading mayhem.

 

Drought center climatologist says lingering dry pattern is a concern

https://brownfieldagnews.com/news/drought-center-climatologist-says-lingering-dry-pattern-is-a-concern/

  • According to Brian Fuchs, a climatologist with the National Drought Mitigation Center, extremely dry conditions, specifically in the High Plains and western Corn Belt, are a major concern heading into winter.
    • Fuchs says current forecasts are projecting the dry pattern could continue into 2021.
  • If we don’t have banked moisture in the ground heading into the 2021 production year, many areas will be starting off on the wrong foot, a situation that concerns Fuchs.
  • An important thing to watch will be where the winter storm track sets up starting in late November and early December. As we head into winter, specifically in the western Corn Belt, it’ll be important to pay attention to what the conditions are, because most likely those conditions will carry into the spring.
  • Here in Nebraska, for the first time since July 2013, 100 percent of the state is listed in drought conditions. Eleven percent of the state is listed in extreme drought.

 

Boxed beef prices

www.nationalbeefwire.com

  • Choice boxed beef: $208.47 (-2.13)
  • Select boxed beef: $190.91 (-0.76)

 

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