Livestock Highlights: Top Stories of the Day

Features Dow Jones Newswires

TOP STORIES

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Cargill Sees Growth in Hungry Livestock -- Market Talk

9:36 ET -- A growing bet on animal feed is paying dividends for agricultural giant Cargill, which said 2Q profits from "animal nutrition" exceeded the prior year's strong returns at a time when profits from grain trading and meat processing slipped. The business is a natural one for Cargill, which processes farmers' grain and also produces chicken and beef around the globe, and the Minnesota company aims to feed more animals. Since August, Cargill has invested tens of millions to expand feed production in Asia, bought a Brazilian cattle feed maker, and acquired several U.S.-based feed companies. (jacob.bunge@wsj.com; @jacobbunge)

STORIES OF INTEREST

Tax Law Could Bring 'Material Cost' to Cargill -- Market Talk

10:18 ET -- Cargill is still assessing the impact of last month's U.S. tax overhaul on one of the biggest U.S. food companies, but a spokeswoman says the company "may incur material costs due to mandatory repatriation of accumulated foreign earnings." At the same time, Cargill is likely to see a "modest" domestic tax benefit in future years, largely through the lower corporate tax rate, she says. Cargill needs cash overseas to run operations ranging from chicken farms to financial trading, and most of its cash flow continues to be reinvested in the business, with more than $1B in acquisitions, joint ventures and new investments made over the company's most recent quarter. (jacob.bunge@wsj.com; @jacobbunge)

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Traffic, Sales Data Negatives for Kroger -- Market Talk

11:29 ET -- JPMorgan analysts are skeptical that Kroger's strong 3Q performance will last, arguing that stock-up trips prior to last year's hurricanes likely helped the U.S.'s largest supermarket chain beat expectations. Orbital Insight satellite data forecast a 1.1% fall in traffic at established Kroger stores so far in 4Q over the previous year. Nielsen sales data for grocery also showed weakness for the last two months of the year. "We remain somewhat skeptical that last quarter's bump .... will be wholly sustainable," the analysts write. Kroger slips 1.4% to $27.89.( heather.haddon@wsj.com; @heatherhaddon)

FUTURES MARKETS

Cattle Futures Mixed; Beef Prices Sizzle

Cattle futures were mixed as buying interest cooled after recent gains.

February-dated contracts for live cattle fell 0.3% to $1.2295 a pound at the Chicago Mercantile Exchange, while later-month futures were higher.

CME February lean hog futures rose 0.5% to 71.05 cents a pound.

CASH MARKETS

Zumbrota, Minn Hog Steady At $35.00 -- Jan 3

Barrow and gilt prices at the Zumbrota, Minn., livestock market today are steady at $35.00 a hundredweight. Sow prices are steady. Sows weighing 400-450 pounds are at $27.00-$28.00, 450-500 pounds are $27.00-$28.00 and those over 500 pounds are $29.00.

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 - Jan 3

All figures are on a per-head basis.

Date Standard Margin Estimated margin

Operating Index at vertically -

integrated operations

*

Jan 3 +$30.23 +$36.99

Jan 2 +$34.10 +$36.65

Dec 29 +$37.37 +$36.97

* 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.

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 102.5

(Percent of Year-Ago) Select 102.7

USDA Boxed Beef, Pork Reports

Wholesale choice-grade beef prices Wednesday rose $3.48 per hundred pounds, to $208.62, according to the USDA. Select-grade prices rose $2.59 per hundred pounds, to $199.16. The total load count was 156. Wholesale pork prices rose 16 cents, to $77.61 a hundred pounds, based on Omaha, Neb., price quotes.

(END) Dow Jones Newswires

January 03, 2018 17:44 ET (22:44 GMT)