LIVESTOCK HIGHLIGHTS: Top Stories of the Day

Features Dow Jones Newswires

TOP STORIES

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Tax Law Could Foster New Breed of Cooperatives -- Market Talk

15:31 ET - The U.S. Farm Belt could see a new generation of agricultural cooperatives created thanks to a change in deductions allowed for farmers who sell crops and other goods to co-ops. The new tax law provides a big deduction linked to farmers' sales to co-ops, raising objections from independent grain companies who fear an uneven playing field. In response, some accountants think privately-held and investor-owned grain companies are likely to set up their own cooperative structures, extending membership to established farmer clientele, who would agree to sell crops to the companies' grain facilities. (jacob.bunge@wsj.com; @jacobbunge)

Farm Deduction Shift Could Cascade Across Agriculture -- Market Talk

15:27 ET - Independent grain companies are raising alarms after the new U.S. tax law provides substantial deductions to farmers who sell crops and other goods to cooperatives. But the shift could also impact meat processors, which have increasingly been buying crops directly from farmers to supply animal feed mills. Some food ingredient makers also purchase directly from farmers. If farmers instead sell more crops to cooperatives to reduce their tax obligations, companies could wind up sourcing more of their grain from cooperatives, potentially adding another layer of costs, agriculture industry officials say. (jacob.bunge@wsj.com; @jacobbunge)

STORIES OF INTEREST

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New Zealand Drought Classification Extended -- Market Talk

1616 ET - New Zealand's agriculture minister has extended a drought ruling to the country's South Island. Farmers in New Zealand, whose economy is driven by agriculture exports, have been dealing with a hot, dry summer. While a storm drenched much of the North Island last week, the Grey and Buller districts on the west coast of the South Island missed out on the much needed rain. "On the back of an extremely wet winter that left many farmers unable to grow pasture or crops for spring, the early and unusual dry start to summer turned West Coast pastures from swamp to concrete," says agriculture minister Damien O'Connor. A drought classification, which unlocks support funding, was first announced for areas in the lower North Island just before Christmas. (ben.collins@wsj.com)

USDA Proposes New Egg Inspection Rule -- Market Talk

12:37 ET - USDA is proposing changes to the way egg products are inspected, requiring plants to develop detailed plans to prevent foodborne illness and make sure dangerous pathogens can't be found on finished products. Under the rule, plants that make egg products--used in goods from baking mixes to mayonnaise to ice cream--would also be subject to sanitation requirements similar to those that apply to U.S. meat and poultry industries, ensuring "the same level of inspection and oversight of all regulated products," the USDA says. The proposed rule comes a day after President Trump and USDA Secretary Sonny Perdue touted the administration's record on rolling back regulations at an annual farm convention. (jesse.newman@wsj.com; @jessenewman13)

FUTURES MARKETS

Cattle Futures Find Footing; Cash Trade Lower

Cattle futures rose after several sessions of heavy losses, with bargain hunters taking advantage of discounted prices.

February-dated contracts for live cattle rose 0.4% to $1.17675 a pound at the Chicago Mercantile Exchange.

CASH MARKETS

Zumbrota, Minn Hog Steady At $40.00 - Jan 9

Barrow and gilt prices at the Zumbrota, Minn., livestock market today are steady at $40.00 per hundredweight. Sow prices are steady. Sows weighing 400-450 pounds are at $30.00-$32.00, 450-500 pounds are $30.00-$32.00 and those over 500 pounds are $34.00-$36.00.

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 9

This report reflects U.S. pork packer processing margins. The margin indices

are calculated using current cash hog or carcass values and wholesale pork

cutout values and may not reflect actual margins at the plants. These

estimates reflect the general health of the industry and are not meant to

be indicative of any particular company or plant.

Source: USDA, based on Wall Street Journal calculations

All figures are on a per-head basis.

Date Standard Margin Estimated margin

Operating Index at vertically -

integrated operations

*

Jan 9 +$17.54 +$ 38.97

Jan 8 +$19.11 +$ 36.13

Jan 5 +$23.54 +$ 38.50

* 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 105.9

(Percent of Year-Ago) Select 105.4

USDA Boxed Beef, Pork Reports

Wholesale choice-grade beef prices Tuesday rose 29 cents per hundred pounds, to $210.49, according to the USDA. Select-grade prices rose 32 cents per hundred pounds, to $203.69. The total load count was 117. Wholesale pork prices rose $1.32, to $78.53 a hundred pounds, based on Omaha, Neb., price quotes.

(END) Dow Jones Newswires

January 09, 2018 17:47 ET (22:47 GMT)