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Livestock prices this week settled mixed: LCM0 +2.350 (+2.48%), LHM0 -3.825 (-6.20%).  ‘

June live cattle on Friday closed higher and finished the week up +2.48%.  Jun cattle climbed to a 1-1/2 month high Wednesday on strong domestic beef demand after wholesale beef prices surged to a record high Tuesday (data from 2001).  Also, packer demand for cattle should remain strong as beef packer profit margins remained at a record high Friday (data from 2013).  Cattle prices have rallied sharply over the past three weeks on concern about U.S. beef supplies.  10% of U.S. beef output has been idled with the closure of beef processing plants in Iowa, Minnesota, Colorado, South Dakota and Washington after workers at the plants tested positive for the coronavirus.  Global beef supplies may also be at risk as workers infected by the coronavirus caused beef processing plants to close in Ireland and Germany as well.  USDA slaughter data Friday shows 1.102 mln head of cattle processed this year through May 9, down -5.8% y/y.  Cash cattle prices have also recovered as cash cattle prices climbed to a 1-1/2 month high Thursday.  Cash cattle prices plummeted to a 9-1/2 year low last month as an increasing number of slaughterhouses throughout the U.S. have closed due to coronavirus infections among their workers, leaving cattle ranchers without a market for their animals and causing a backlog of cattle waiting to be processed.  The USDA on Tuesday cut its U.S. 2019/20 beef production estimate to 25.83 mln lbs from an Apr forecast of 27.51 mln lbs, down -5.1% y/y and the first decline in 5 years.  The USDA also cut its U.S. 2019/20 beef export estimate to 2.894 mln lbs from an Apr estimate of 3.16 mln lbs, down -4.2% y/y.  Jun cattle tumbled to a contract low Apr 6 and nearest-futures (J20) plunged to a 10-1/4 year low on concern the coronavirus pandemic has yet to peak in the U.S., which may keep restaurants closed for longer and is negative for domestic beef demand.  Beef supplies were robust as of March after the USDA reported Apr 23 that U.S. Mar commercial beef production rose +13.7% y/y to 2.41 bln lbs.  However, future beef supplies may shrink with the current closure of beef processing plants.  Foreign demand for U.S. beef has improved with U.S. Jan-Mar beef exports up +10.5% y/y to 769.252 million lbs. 

June lean hog prices on Friday closed lower and finished the week down -6.20%.  Jun hogs on Thursday fell to a 2-week low on concern rising prices will curb demand.  Wholesale pork prices soared to a 5-1/2 year high Monday, which has led to a surge in retail pork prices in grocery stores and may prompt consumers to switch to cheaper cuts of meat, such as chicken.  Concern about tight pork supplies has led to a surge in wholesale prices with 25% of U.S. hog-slaughtering capacity with the closure of pork processing plants throughout the U.S. after workers at the plants tested positive for the coronavirus.  Also, hog weights have jumped as the closure of processing plants keeps hogs from slaughter.  The average hog carcass weight on May 8 rose to a 6-year high of 221.85 lbs, which may lead to bigger pork supplies.  Tighter pork supplies kept pork packer profit margins at a record high Friday (data from 2013), which will encourage packers that remain open to boost their hog purchases.   Another negative is weak cash hog prices that are modestly above the record low from Apr 23 (data from 2003) as an increasing number of slaughterhouses throughout the U.S. have closed due to coronavirus infections among their workers, leaving pig farmers without a market for their animals and causing a backlog of hogs waiting to be processed.  Hog prices plunged to a 17-1/2 year low Apr 14 on concern the coronavirus pandemic has yet to peak in the U.S., which may keep restaurants closed for longer and is negative for domestic pork demand.  Wholesale pork prices plunged to a 17-1/2 year low Apr 9 as U.S. pork demand plummeted as the spread of the coronavirus prompted the cancellation of events and the closure of schools and restaurants.  Current pork supplies were robust though March after the USDA reported Apr 23 that U.S. Mar pork production rose +11.7% y/y to 2.57 bln lbs, although future supplies will tighten as 25% of U.S. pork processing plants remain idle.  The Mar 27 USDA Q1 Hogs & Pigs report showed a record U.S. hog herd on Mar 1 at 77.6 million hogs.  Foreign demand for U.S. pork is solid as Mexico, the top importer of U.S. pork, has resumed purchases and China has ramped up its pork buying after its recent Phase-1 agreement.  U.S. Jan-Mar pork exports jumped +39.9% to 2.023 bln lbs.  The USDA on Tuesday cut its U.S. 2019/20 pork production estimate to 27.45 mln lbs from an Apr forecast of 29.049 mln lbs, down -0.7% y/y and the first decline in U.S. pork production in 6 years.  The USDA also cut its U.S. 2019/20 pork export estimate to 7.148 mln lbs from an Apr forecast of 7.475 mln lbs, up +13.1% y/y 

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