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Low Food Prices Are Hurting Farm State Economies
Farmers are producing too much food, holding down prices and holding back economies in states with big agricultural industries.
South Dakota and Iowa are the only two states in the country where gross domestic product fell in the second quarter. Ultra-low crop and livestock prices stemming from a global oversupply have squeezed farm incomes, pulling down Iowa's GDP 0.7% and South Dakota's 0.3% from the prior quarter.
Fonterra Lowers Farmgate Milk Price After Global Dairy Market Volatility
WELLINGTON--The world's largest dairy exporter said Thursday it was lowering the amount it pays farmers in the co-operative for milk after volatility in the global dairy market.
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New Zealand's Fonterra Co-Operative Group also said challenging weather conditions mean it now expects the amount of milk that will be collected during the current fiscal year to be flat at 1,525 million kilograms of milk solids, 1% lower than its previous forecast.
Meanwhile, Fonterra also released results for the first quarter of its fiscal year. Its revenue rose 4% compared to the same period a year ago at NZ$4 billion, though sales volumes fell 20% to 3.9 billion liquid milk equivalents, while its gross margin was also lower at 16.7%.
STORIES OF INTEREST
Snylait Opens New Kitchen to Double Formula Production
WELLINGTON, New Zealand--Synlait Milk (SML.NZ) on Thursday opened a new kitchen facility that the company expects will double its annual production of infant formula to 80,000 metric tons.
The New Zealand-based company is a production partner of the A2 Milk Co. (ATM.NZ), whose share price has more than tripled since this time last year, after strong demand for its infant formula product.
Zhuhai Port To Raise $225M For Huge Bulker Fleet -- Market Talk
09:32 ET - Zhuhai Port, a major gateway in the Pearl River Delta close to Macau, plans to raise $225M in a share issue that will be used to buy 55 ships for general cargo transport in Chinese coastal regions. The fleet expansion is aimed to transform the port operator into a logistics provider of coal, grain and iron ore to feed China's fast growing coastal cities and cut the country's reliance on chartered vessels, mainly from European operators. (email@example.com)
Cattle Futures Fall as Packers Haggle for Lower Prices
Lower prices for physical cattle sent the futures market lower on Wednesday.
The U.S. Department of Agriculture said that meatpackers paid from $117 to $118 per 100 pounds on a live basis and $187 dressed for slaughter-ready cattle on Wednesday, adding to sales averaging $189 dressed and $119 live a day earlier. No cattle traded at the online Fed Cattle Exchange auction on Wednesday morning.
December live cattle contracts fell 0.5% to $1.159 a pound at the Chicago Mercantile Exchange on Wednesday, down 4% since they started trending lower last week.
Hog futures also fell, dragged lower by speculative selling in the cattle market. CME December lean hog contracts slid 0.7% to 63.825 cents a pound.
Zumbrota, Minn Hog Steady At $36.00 - Dec 6
Barrow and gilt prices at the Zumbrota, Minn., livestock market today are steady at $36.00 per hundredweight.
Sow prices are steady. Sows weighing 400-450 pounds are at $33.00-$34.00, 450-500 pounds are $33.00-$34.00 and those over 500 pounds are $35.00-$37.00.
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 - Dec 6
All figures are on a per-head basis.
Date Standard Margin Estimated margin
Operating Index at vertically -
Dec 6 +$43.54 +$46.63
Dec 5 +$46.91 +$50.80
Dec 4 +$46.57 +$49.68
* Based on Iowa State University's latest estimated cost of production.
A positive number indicates a processing margin above the cost of production of the animals.
This report compares the USDA's latest beef carcass composite
values as a percentage of their respective year-ago prices.
For Today Choice 107.8
(Percent of Year-Ago) Select 106.3
USDA Boxed Beef, Pork Reports
Wholesale choice-grade beef prices Wednesday fell $2.68 per hundred pounds, to $206.40, according to the USDA. Select-grade prices fell $2.52 per hundred pounds, to $184.11. The total load count was 169. Wholesale pork prices fell $1.94, to $82.09 a hundred pounds, based on Omaha, Neb., price quotes.
(END) Dow Jones Newswires
December 06, 2017 17:51 ET (22:51 GMT)