LIVESTOCK HIGHLIGHTS: Top Stories of the Day

TOP STORIES

Beef Prices Retreat for Second Week in Grocery Ads — U.S. Retail Meat

Average beef prices slipped lower for the second week in a row in grocery-store advertisements this week, according to the latest Wall Street Journal retail-meat survey. Average pork prices gained modestly.

The 15-cut average for beef decreased to $5.15 from $5.18 a pound last week. It was down from $5.52 a year earlier, the Journal survey found.

Danone Boosts U.S. Business With WhiteWave Deal — 4th Update

PARIS–Danone SA has agreed to buy U.S. organic-foods producer WhiteWave Foods Co. for $10.4 billion, a deal that would hand it a slice of the fast-growing market for organic food and more than doubles its North American revenue.

The French dairy company said on Thursday that it would pay $56.25 a share in cash for WhiteWave. The deal–Danone’s largest acquisition in a decade–would boost the company’s upmarket product line with brands including Horizon Organic milk, Wallaby Organic yogurt and Earthbound Farm packaged salad, which WhiteWave said are the top sellers in their categories.

McDonald’s to Take $235 Million Second-Quarter Charge Tied to Refranchising

McDonald’s Corp. said it would book more than $200 million in charges in the June quarter related to its planned sale of 4,000 restaurants to franchisees by 2018, the company said Thursday.

The $235 million charge, which also includes some costs tied to relocating its headquarters to downtown Chicago, would lower profit by about 20 cents a share, the company said.

Investors generally like the move toward more franchised locations because it gives companies a more stable cash flow from royalties, licensing and property leases and tend to have a higher profit margin while avoiding the ups and downs of labor and commodity costs.

STORIES OF INTEREST

U.K. Farmers Could Face Cheap Imported Foods — Brexit Market Talk

15:13 ET – Meurig Raymond, president of the UK’s National Farmers’ Union, outlines his “nightmare scenario” for a U.K. exit from the EU. Speaking at an industry conference in Birmingham, he speculates that if inflation grips the U.K. economy due to the weakening pound, politicians may appease consumers at the expense of British farmers by accepting terms in trade negotiations that allow cheaper produce into the U.K. “It could be beef from Brazil, wheat from Ukraine,” he says. Many countries’ imports into the U.K. are subject to tariffs under pan-EU trade rules; the U.K. may need to strike its own bilateral deals if it leaves the bloc. (ed.ballard[a]wsj.com)

U.K. Farmers Consider Post-EU Subsidy Plan — Brexit Market Talk

15:19 ET – The U.K.’s upcoming exit dominates conversation among farmers at a livestock conference in Birmingham, U.K. So far, Brexit is treating many of them well, as the cheaper pound boosts export sales to the U.K.’s European neighbors. Looking further ahead, farmers’ fortunes depend partly on what–if any–subsidy regime the U.K. government comes up with to replace the EU’s Common Agricultural Policy. National Farmers’ Union president Meurig Raymond talks of a U.S.-style “farm bill” that would lay out a support program every 10 years or so. But few farmers expect the new regime to match the generosity of the CAP: the U.K. has pushed for reduced EU farming subsidies. (ed.ballard[a]wsj.com)

China Flooding Roils Soybean Meal Market — Update

Massive flooding in China that has killed livestock and farmed fish was blamed for a 5% plunge in the price of soybean meal in just 30 minutes Thursday, as traders on the Dalian Commodity Exchange worried about a drop in demand for the feedstock.

Prices for the September soybean meal contract on the Dalian–the largest commodity exchange in China and the eighth biggest globally–hit a low of 3,106 Chinese yuan ($465) a metric ton before bouncing back to end the session down 2.8%, at 3,199 yuan a ton.

Amid the heavy rains, the soymeal contract on the Dalian exchange has fallen in four successive sessions.

Wendys Says About 20% of U.S. Franchise Stores Hit by Cyberattack

Wendy’s Co. said Thursday roughly a fifth of its franchise-operated stores were affected by cyberattacks that hit the burger chain starting last fall, more than previously disclosed.

The Dublin, Ohio-based company said 1,025 of its franchise-owned restaurants were subject to what it called “highly sophisticated, criminal cyberattacks.” Wendy’s said it hasn’t yet found any company-owned stores that were affected.

FUTURES MARKETS

U.S. Cattle Futures Slide to 5-Year Lows on Demand Worries

CHICAGO–Livestock futures settled lower on Thursday, with the cattle market tumbling to the lowest levels in five years as traders brace for a swell of supplies.

August live-cattle futures fell 0.85 cent, or 0.8%, to $1.1180 a pound on the Chicago Mercantile Exchange, the lowest closing price for a front-month contract since July 2011. Feeder-cattle futures for August dropped 0.95 cent to $1.43625 a pound.

CASH MARKETS

 
 Zumbrota, Minn Hog Market steady At $52.00 - Jul 7 
 
 Stock Market Quotes, Business News, Financial News from http://commodity-market-news.com

Barrow and gilt prices at the Zumbrota, Minn., livestock market today are steady at $52.00 per hundredweight.

Sow prices are steady. Sows weighing under 450 pounds are $38.00-$40.00, 400-450 pounds are at $38.00-$40.00, 450-500 pounds are $38.00-$40.00 and those over 500 pounds are $41.00-$42.00.

The day’s total run is estimated at 100 head.

Prices are provided by the Central Livestock Association.

 
Estimated U.S. Pork Packer Margin Index - Jul 7 
 
Date     Standard Margin       Estimated margin 
         Operating Index         at vertically 
                             integrated operations 
                                      * 
Jul 07       +$18.19              +$49.39 
Jul 06       +$16.99              +$49.82 
Jul 05       +$15.14              +$49.69 
 
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   86.8 
      (Percent of Year-Ago)     Select   82.3 
 
USDA Boxed Beef, Pork Reports 
 
 

Wholesale choice-grade beef prices Thursday rose 97 cents per hundred pounds, to $210.05, according to the USDA. Select-grade prices rose 5 cents per hundred pounds, to $196.98. The total load count was 160. Wholesale pork prices fell 20 cents, to $88.71 a hundred pounds, based on Omaha, Neb., price quotes.

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