Current Cattle Market Daily Headlines for Tuesday, October 6, 2020

Mackenzie Johnston

6 years ago

CME Group launching pork cutout futures, options

On September 29^th, CME Group announced that it would launch pork cutout futures and options on November 9^th, 2020, pending all relevant regulatory review periods.
According to Tim Andriesen, CME Group managing director of agriculture products, CME customers are looking for new tools to help manage price risk associated with hog and pork production. He went on to say that pork cutout futures would provide clients with the ability to manage risk and discover price from the hog all the way to the meat case.
More and more, hogs are bought and sold in the physical market based on a formula that uses the cutout.
- The cutout is calculated using the prices paid for wholesale cuts of pork.
  - The values used to calculate the pork cutout include the loin, butt, picnic, rib, ham and belly.
- Pork cutout futures and options will be financially settled to the CME Pork Cutout Index.
- The new contracts will reflect the price of the wholesale product after processing, they will be quoted in U.S. cents per pound, will have a contract size of 40,000 lb., will be available for trading on CME Globex or through block trades via CME ClearPort and will be listed by and subject to CME rules and regulations.

Culver’s recently released a Harvest Veggie Burger that differs from other vegetarian options sold by competitors.
The Harvest Veggie Burger took four years to develop and consists of grains, roasted corn, portobello mushrooms, bell peppers, spinach and chickpeas. The burger does include Wisconsin cheeses, so it cannot be truly designated as vegan.
The sandwich can be found at any of Culver’s 760 locations across 25 U.S. states.

Labor issues within the meat-processing sector have been constant for years.
- That issue was made worse this year as Covid-19 spread, resulting in a high degree of subsequent absenteeism.
Georgia Tech Research Institute recently performed intricate deboning tasks on chickens with a new robotic system that has been in the making for several years.
This automated deboning machine runs at 75 percent speed, processing approximately 15 chickens a minute.
- This speed is slower than a manual deboning process, however it would solve labor issues within packing plants.
The new robotic machine differs from earlier versions with its ability to use machine vision and artificial intelligence to address each carcass individually, improving yields.