Editorial

Commercial Banks in China Experiencing Dollar Squeeze

05/02/2019

The combined dollar liabilities at the four biggest banks in China now exceed their dollar holdings. The institutions comprise the Bank of China, Agriculture Bank of China, Industrial and Commercial Bank of China and the China Construction Bank.  At the end of 2008, the Bank of China was $70 billion in deficit but claimed that off balance sheet dollar assets covered the shortfall.  The three other banks collectively showed a dollar surplus on their balance sheets amounting to approximately $15 billion.

 

Banks in China require dollars since currency derivatives mature within 12 months requiring regular renewal.  China is active in the swap market with other central banks but does not have an agreement with the U.S. Federal Reserve. 

 

China is however in no danger of embarrassment over the shortfall of dollars since the Central Government apparently holds $3.1 trillion in foreign exchange reserves and would come to the aid of any quasi-commercial bank all of which operate with close state supervision.  The dollar is still regarded as the most significant currency for international trade with many commodities including oil and gold bear dollar denominations.  The Chinese yuan is not universally accepted and conversion is difficult.

 

If a trade agreement is negotiated, China may still show a preference towards Brazil and Argentina for purchases of soybeans and other commodities if they can pay with their own currency or effect a state-sponsored barter transaction.  Clearly if the magic wand could resolve trade differences immediately, the U.S. may not reclaim the Chinese export market which has been profoundly eroded.  This has implications for the agricultural sector.  Prices of soybeans and hence meal will remain depressed and this will influence production costs for all monogastric livestock. Perhaps we will never revert to pre-trade war equilibrium. Belgian endives anybody?

 



 

Poultry Industry News

USDA-WASDE FORECAST #588 May 10th 2019

05/15/2019

OVERVIEW

The May 10th 2019 USDA WASDE projections for the 2019 corn and soybean harvests are based on historical yield and harvest data. The corn acreage to be harvested was determined from planting completed and stated intentions at 85.4 million acres (81.8 million in 2018). In 2019 soybeans will be harvested from 87.8 million acres (88.3 million acres in 2018). There was apparently no material change due to recent Midwest flooding or the forecast for wet conditions from snowmelt delaying planting.

The USDA projected corn yield to attain 176.0 bushels per acre, (178.9 bushels in 2018). Soybean yield was projected at 49.5 bushels per acre (52.1 bushels in 2018). These values presume suitable planting and growing conditions, time of sowing and standard rates of germination.

The May USDA projection of ending stock for corn was increased by 22.1 percent to 2,485 million bushels. Ending stock for soybeans will be 8.5 percent higher at 970 million bushels. Ending stocks for both corn and soybeans have influenced recent CME price quotations. It is emphasized that projections are based on the presumption of at least a partial settlement of the trade dispute with China followed by restoration of exports to that Nation, a prospect that appears in question given lower demand from China and the latest round of tariffs imposed by both nations.


 

Weekly Turkey Production and Prices

05/18/2019

Poult Production and Placement:

The May 15th edition of the USDA Turkey Hatchery Report, issued monthly, documented 28.2 million eggs in incubators on May 1st 2018 (28.8 million eggs on April 1st 2019) down 2.5 percent (0.7 million eggs) from April 1 st 2018.

A total of 23.9 million poults were hatched during April 2019 (24.0 million in March 2019) and up 1.7 percent from April 2018.

A total of 22.0 million poults were placed on farms in the U.S. in April 2019, (21.7 million in March 2019), 1.1 percent less than in April 2018. This suggests disposal of 1.8 million poults during the month. Assuming all tom poults were placed, 14.9 percent of hen poults or 7.4 percent of all April 2019-hatched poults were not placed.

For the twelve-month period May 2018 through April 2019 inclusive, 289.0 million poults were hatched and 262.3 million were placed. This suggests disposal of 26.7 million poults. Assuming all tom poults were placed 18.2 percent of hen poults or 9.1 percent of all poults hatched during the period were not placed.

Turkey Production:

The May 17th 2019 edition of the USDA Turkey Market News Report (Vol. 66: No. 20) confirmed the following provisional data for turkeys slaughtered under Federal inspection:-


 

Updated USDA-ERS Poultry Meat Projection for 2019.

05/19/2019

The USDA-Economic Research Service released production and consumption data on May 16th for broilers and turkeys covering 2018 (revised) and 2019 (forecast) together with a projection for 2020.

Broiler data for 2019 was essentially unchanged from the April 2019 report. Production in 2019 will increase by 0.9 percent compared to 2018 to 19.541 million metric tons (42,990 million lbs.) RTC. Per capita consumption was increased for 2019 from the April report to 42.3 kg. (92.6 lbs.) Exports will represent 16.5 percent of RTC production in 2019 attaining 3.230 million metric tons (7,106 million lbs.) This is based on the presumption that the recently concluded USMCA will be approved by Congress and by the legislatures of Canada and Mexico.

Turkey production will decrease by <0.1 percent in 2019 compared to 2018 to 2.673 million metric tons (5,881 million lbs.) RTC. Per capita consumption will attain 7.3 kg. (16.1 lb.) during 2019, a 1.4 percent downward projection despite promotions and introduction of further-processed items. Export volume will be the same as 2018 at 0.277 million metric tons (610 million lbs.).

Forecast values for production and consumption of RTC turkey in 2019 are considered to be optimistic given 2019 prices, egg settings, poult placements, disposal of hen poults, weekly production levels and inventory. The USDA projection presumably takes into account that the recently concluded USMCA, if ratified by the legislatures of all three nations, will avert tariffs. This will maintain market share in Mexico despite growing competition from Chile and other nations in Latin America.

Metric values for the broiler and turkey segments of the U.S. poultry meat industry are tabulated below:-

 

 

Parameter

2018 (actual)

2019 (forecast)

% Difference 2020 2018 to 2019 (projection)

Broilers

     

Production (m. metric tons)

19.364

19.541

+0.9 19.795

Consumption (kg per capita)

42.0

42.3

+0.7 42.4

Exports (m. metric tons)

3.212

3.230

+0.6 3.295

Proportion of production (%)

16.6

16.5

-0.6 16.7

       

Turkeys

     

Production (m. metric tons)

2.671

2.673

<+0.1 2.700

Consumption (kg per capita)

7.4

7.3

-1.4 7.3

Exports (m. metric tons)

0.277

0.277

0 0.286

Proportion of production (%)

10.3

10.3

0 10.6

Subscribers are referred to the weekly updates of production and inventories of broilers and turkeys posted weekly on CHICK-NEWS

Source: Livestock, Dairy and Poultry Outlook -May 16th 2019


 

Weekly Broiler Production and Prices

05/19/2019

Chick Placements.

The Broiler Hatchery Report released on May 15th confirmed that a total of 232.8 million eggs were set during the week ending May 11th, one percent more than in the corresponding week in 2018. A total of 181.9 million day-old chicks were placed among the 19 major broiler-producing states during the week ending May 11th. This was two percent higher than the corresponding week in 2018. Total chick placements for the U.S. amounted to 189.7 million. Claimed average hatchability was 82.5 percent for eggs set three weeks earlier. Broiler chick placements for 2019 through May 11th amounted to 3.52 billion, one percent more than YTD 2018.

Broiler Production

According to the May 17th USDA Broiler Market News Report (Vol. 66: No.20) for the processing week ending May 11th 2019, 164.4 million broilers were processed at an average live weight of 6.18 lbs. (6.20 lbs. last week) and a nominal yield of 76.0 percent. The number of broilers processed was 1.1 percent more than the corresponding processing week in 2018. Processed (RTC) broiler production for the week was 788.1 million lbs. (355,043 metric tons), 2.5 percent above the corresponding week in 2018. Production YTD of RTC in 2019 is 14.29 million lbs. (6,696,912 metric tons), 0.7 percent more than in 2018 YTD.


 

WEEKLY COMMODITY REPORT

05/20/2019

The following quotations for May and July as indicated were posted by the CME at close of trading on Thursday May 17th together with values for the previous week in parentheses. Last week the commodities market recorded an increase in the futures price of corn, a sharp decline for soybeans and an almost static price for soybean meal delivered in July and September. This was attributed to the unexpected imposition of tariffs on goods to be imported from China in response to alleged backtracking by that nation leading to a lack of progress in bilateral trade negotiations to settle the ongoing dispute. Optimism leading to increases in commodity prices two weeks ago was apparently premature. The negative effect of the release of the USDA Grain Stocks Report on Friday March 29th documenting soybean stocks followed by the May WASDE #588 confirmed the effect of reduced shipments of soybeans to China. The numerous conflicting statements by White House spokespersons over the months since the dispute began is disconcerting to the commodities market and contributes to fluctuation in prices.

COMMODITY

 

Corn (cents per bushel)

July 383 (362 May)

Sept. 390 (370 July)

Soybeans (cents per bushel)

July 821 (830 May)

Sept. 834 (843 July)

Soybean meal ($ per ton)

July 294 (292 May)

Sept. 297 (297 July)

Changes in the price of corn, soybeans and soybean meal this past week were:-

COMMODITY CHANGE FROM PAST WEEK

Corn: July quotation up 21 cents per Bu from May (+5.8 percent)

Soybeans: July quotation down 9 cents per Bu      (-1.1 percent)

Soybean Meal: July quotation up $2 per ton.         (-0.7 percent)

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.40 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

COMMENTS

The USDA Crop Progress Report for the week ending May 6th noted that 23 percent of the corn crop had been planted, compared to a five-year average of 46 percent. Six percent of the corn crop has emerged compared to the five-year average of 13 percent.

Six percent of the soybean crop has been planted, compared to the five-year average of 14 percent

The March 29th USDA Grain Stocks Report, issued Quarterly confirmed a 3.2 percent decline in corn stocks in all positions to 8.60 billion Bu. compared to the March 2018 report. Farm storage represented 59.6 percent of this total, 2.5 percent higher than for the corresponding period in 2018.

Soybean stocks increased by 28.7 percent from March 2018 to 2.716 billion Bu. in March 2019. On- farm storage attained 1.270 billion Bu. representing 46.7 percent of all stocks. On-farm storage was 48.5 percent higher in March 2019 compared to 2018 reflecting the intent of farmers to hold stocks in anticipation of a rise in price following resumption of exports to China.

Negotiations with China are apparently at an impasse unless China makes extensive, durable and firm concessions as suggested following shuttles between Beijing and Washington that will continue as high-level discussions in the U.S. this week. Some concessions have been made by China on coercive trade practices and dispute resolution as amplified by President Xi addressing participants in a Belt and Road Conference this past week but apparently not to the satisfaction of the White House. From an agricultural industry perspective the question of delays by China in approving new GM cultivars has yet to be settled. No date has been set for a summit to sign a trade deal although the Presidents of China and the U.S. are scheduled to meet at the G20 Summit in Japan in June. Prices will be influenced by the trend in stock levels, area to be planted in 2019 and early crop progress in the face of possible flooding.

According to the May 8th 2018 WASDE Report #588, 85.4 million acres of corn will be harvested in 2019 to produce 15.0 billion bushels. The soybean crop is projected to attain 4.15 billion bushels from 87.8 million acres harvested. The levels of production for the two commodities are based on preliminary pre-planting projections of yield and crop progress. Ending stocks were revised based on anticipated domestic use and exports.

See the WASDE posting summarizing the May 8th USDA-WASDE Report #588 under the STATISTICS tab documenting price projections and quantities of commodities to be produced, used and exported from the 2019 harvest.

Unless shipments of corn and soybeans to China resume in volume, as anticipated, the financial future for row-crop farmers appears bleak despite the release of two tranches amounting to $8 billion as "short-term" compensation for producers of commodities. A further $20 billion compensation is anticipated.

Late-May will be make-or-break for negotiations with China. The outcome has profound implications not only for the two antagonists but for the World economy.


 

Status of Corn and Soybean Crops

05/21/2019

The USDA Crop Progress Report released on May 20th documented the status of the 2019 corn and soybean harvest.

 

Planting of both corn and soybeans was delayed in many states by heavy spring rains and flooding

 

EGG-NEWS and CHICK-NEWS will report on the progress of the two crops and will post weekly updates through the end of the harvest.

 

 

 

Week Ending

Crop Parameter

        May 12

         May 19

5-Year Average

Corn Planted

             30

           49

         80

Corn Emerged

             10

           19

         49

 

 

 

 

Soybeans Planted

               9

           19

         47

Soybeans Emerged

               -

             5

         17

 

 

 

 


 

Wendy’s to Add Three Chicken Sandwiches to Menu

05/06/2019

In an April 30th announcement, Wendy’s will add three new chicken sandwiches to its Crave menu. The items include S-Awesome Bacon Chicken, Barbeque Chicken and Avocado BLT.

Curt Cane, Executive Vice President, Chief Concept and Marketing Officer commented “After seeing the customer response to our Made to Crave Hamburger, we knew we had to continue the excitement and flavor creativity with chicken”.


 

Kroger to Intensify Technology

05/06/2019

Kroger intends to upgrade technology to compete with mainstream supermarket chains, regional specialty retailers and of course the 600-pound gorilla, Amazon. Being late to the game and not having a clear plan can result in slow and unprofitable initiatives. On the positive side, Kroger has established a relationship with the Ocado Group PLC in the U.K. to erect automated distribution centers. In contrast observers point to the debacle over Vitacost.com which was purchased for $280 million in 2014 but has yet to be integrated into the mainstream of Kroger. In contrast, Walmart purchased Jet.com and integrated senior management into its executive ranks embracing their technology and injecting new systems and business opportunities into their business as evidenced by increasing online and click-and-collect sales. Similarly, Target has revamped their technology with some significant appointments leading to enhanced service and customer satisfaction.

Perhaps there is a clash within Kroger between conservative executives with decades of commitment to the company as a grocery retailer and who are unable to adapt to the realities of a digital economy. Kroger has recorded some recent high-level departures including Christopher Helm, the Chief Information Officer and Matt Thompson, the Digital Officer who was making progress in adapting systems acquired through the Harris Teeter acquisition to a number of Kroger banners.

Inability to recognize the benefits offered by potential acquisitions and inability to relate the cost of acquisition to potential revenue and profit has stalled negotiations and allowed potential high-tech companies to be purchased by competitors.

For fiscal 2018, Kroger posted sales of $121.2 million and earned $3.1 billion in FY 2018. In FY 2017 sales amounted to $122.7 billion with net earnings of $191 million.

It was only in 2018 that Kroger commenced collaboration with Microsoft and experimented with an unmanned grocery delivery service in partnership with Nuro. This appears to be a technical innovation which will not contribute materially to earnings.

A conservative approach to grocery retailing is inappropriate to the second decade of the 21st century as evidenced by static or declining same-store sales and a dearth of innovation by Kroger.


 

Antibiotic Labeling Confusion Highlighted at Animal Agricultural Alliance Summit

05/12/2019

Dr. G. Donald Ritter, Director of Technical Marketing for Mountaire Farms reviewed labeling with specific reference to freedom from antibiotic additives in the production chain. Ritter emphasized the value of the One Health Certified program since it brings together the concept of unified animal production and human health. The One Health Certified program incorporates environmental considerations in addition to feeds and antibiotics.


 

OSHA Imposes $615,000 Penalty Against the Texas Packing Company

05/14/2019

OSHA determined that the Company exposed employees to possible injury from an ammonia refrigeration unit without implementing a required Process Safety Management Program in violation of the Occupational Safety and Health Act of 1970.

In 2016, OSHA imposed a $120,000 penalty on Pilgrim’s Pride following release of              anhydrous ammonia at a plant in Waco, TX. during September 2015. The Agency previously cited Pilgrim’s Pride for violations involving potentially hazardous chemicals in Nacogdoches TX and in DeQueen AR plants.

The implications and responsibilities of operators of processing plants are self-evident.


 

Hain Celestial Group Divests Hain Pure Protein Corp

05/14/2019

Hain Celestial Group has disposed of the remainder of Hain Pure Protein Corporation to Aterian Investment Partners LP. for $80 million. The transaction involves the Empire Kosher® and FreeBird® brands.

Mark L. Schiller, president and CEO of Hain Celestial stated “This divestiture is another step forward in simplifying our organization aligned with our transformational strategic plan for long-term sustainable growth and profitability”.

Hain Celestial intends to apply the proceeds to pay down debt. In early May, Hain Celestial Group sold a plant-based food business to Keystone Natural Holdings.


 

DOJ Issues Grand Jury Subpoena to Defendants of Price-Fixing Lawsuit

05/14/2019

The U.S. Department of Justice has issued subpoenas to the plaintiffs in the civil broiler anti-trust case, requesting discovery produced since 2016. The civil suit filed in 2018 alleges that major broiler producers conspired between 2008 and 2016 to fix, raise, maintain and stabilize prices for broiler chickens.

In a second action, the DOJ has requested information relating to alleged manipulation of the Georgia dock price. In this subpoena, ten major broiler producers are cited. Senior executives employed by eight of the companies served as members of the Georgia Dock Advisory Board.

Following reports in the press, investigations were initiated leading to the demise of the Georgia Dock Price quotation used as one of a number of benchmarks. When the Georgia Dock Price began to deviate from the USDA and Urner Barry benchmark prices, questions were raised as to the reliability of the quotation.


 

Ratification of USMCA to Depend on Lifting Steel and Aluminum Tariffs

05/15/2019

Senator Chuck Grassley (R-IA), Chairman of the Senate Finance Committee, has warned the White House that unless aluminum and steel tariffs placed on Canada and Mexico are rescinded, ratification of the United States, Mexico and Canada Agreement (USMCA) is in jeopardy.  He stated, “If these tariffs aren’t lifted USMCA is dead since there is no appetite in Congress to debate USMCA with these tariffs in place.”  Concurrently, House Speaker Nancy Pelosi (D-CA) is of the opinion that the U.S. should re-open negotiations to strengthen enforcement provisions.  This would create problems with both Canada and Mexico.

 

Grassley maintains that the tariffs on steel and aluminum are detrimental to the economy and represent “a tax on Americans, jeopardizing the prospects of passage of the USMCA in both the Canadian Parliament and the Mexican Congress.”

 

It will be necessary for the legislatures of all three signatories to ratify the USMCA, intended to replace the North American Free Trade Agreement, concluded in 1993.

 


 

Antibiotic-Free Broiler Production in the U.S. Passes 50 Percent Mark

05/15/2019

According to the results of a comprehensive and informative survey conducted by Dr. Greg Rennier, 51 percent of U.S. broiler production is without administration of antibiotics. Rennier divided antibiotic policy into four categories:

  • No antibiotics ever This category represented 51 percent of U.S. production in 2018 compared to three percent in 2014
  • Ionophores only. Anticoccidial ionophore additives are not regarded as true antibiotics but have an effect on the intestinal biome. The E.U. does not regard ionophores as antibiotics.
  • Limited Use. In consistency with the requirements of many QSRs and food-service companies, no antibiotic of human health significance are administered to broilers in this category. Essentially antibiotic administration is restricted to BMD, mainly to suppress or treat clostridial enterotoxicoses including necrotic enteritis.
  • Unrestricted use. Approximately eight percent of broilers produced during 2018 received some type of antibiotic to prevent, control or treat an infection.

It is evident that the industry must dispel the misapprehension that ionophores are antibiotics and subscribe to the E.U. definition. This would simplify both public understanding and marketing of broilers according to antibiotic status.


 

Walmart Reports on Q1 of FY 2020

05/17/2019

In a press release dated May 16th Walmart Stores (WMT) announced results for the 1st Quarter of Fiscal 2020 ending April 30 th 2019.

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

1st Quarter Ending April 30th

2019

2018

Difference (%)

Sales:

$123,925,000

$122,690,000

+1.0

Gross profit:

$30,891,000

$30,983,000

-0.3

Operating income:

$4,945,000

$5,154,000

-4.1

Pre-tax Income*

Net Income

$5,157,000

$3,842,000

$2,822,000

$2,134,000

+82.7

+80.0

Diluted earnings per share:

$1.33

$0.72

+84.7

Gross Margin (%)

24.9

25.3

-1.6

Operating Margin (%)

4.0

4.2

-4.8

Profit Margin (%)

3.1

1.7

+82.3

Long-term Debt:

$47,425,000

$43,520,000

+8.9

12 Months Trailing:

     

%Return on Assets

6.5

   

%Return on Equity

9.0

   

%Operating Margin

4.3

   

%Profit Margin

1.3

   

Total Assets

$234,544,000

$219,216,000

+7.0

Market Capitalization

$286,400,000

   

* Includes $837 million "gain " from other sources in Q1 FY 2002 compared to "expense" of $1,845million in Q1 FY 2009.

52-Week Range in Share Price: $81.79 to $106.21

Market Close: May 15th $99.90 Market Open post-release 16th $103.21

Forward PE: 20.0 Beta 0.7

Walmart U.S. same-store sales growth (without fuel) 3.4% (2.1% FY 2019)

Sam's same-store sales growth (without fuel) 0.3% (3.8% FY 2019)

Walmart U.S. U.S. same-store sales growth (without fuel) 2.9% (2.3% FY 2019)


 

China Imports of Soybeans Higher in April

05/20/2019

China imported 7.6 million tons of soybeans in April according to official sources.  This is approximately 10 percent more than during April 2018 and 55 percent above March.  The difference between March and April is attributed to an adjustment in the value added tax imposed by China.  The majority of the imports were supplied by Brazil. 

 

It is noted that China imposed a 25percent tariff on U.S. soybean in July 2018 in retaliation for tariffs on a range of goods exported by China to the U.S.  Approximately six million tons of projected shipments from the U.S. are now in jeopardy following the announcement of additional tariffs on Chinese imports. 

 

It is likely that China may reduce imports from world sources irrespective of any future agreement with the U.S. since African swine fever has reduced the demand for soybean meal.  Following the advent of increased duties, producers in China have reevaluated levels of protein and incorporation of soybean meal in diets at levels that were possibly too high.


 

US Foods Reports on Q1 of Fiscal 2019

05/20/2019

US Foods reported net income of $71 million on net sales of $6.0 billion for the first quarter of fiscal 2019.  These values were respectively 6 percent and 4 percent higher than Q1 of fiscal 2018.  Case volume, an important parameter for food distribution companies increased 1.4 percent.  EGG-NEWS will post a comparison of the financial results of US Foods and Sysco in due course.


 

Slate of Speakers at USAPEEC Meeting Released

05/21/2019

The May 20th edition of the USAPEEC MondayLine included the list of featured speakers at the 2019 annual meeting to be held in Panama City, Panama June 10th to 13th.

  • Ted McKinney, USDA Undersecretary for Trade and Foreign Agricultural Affairs will address current issues relating to world trade with specific reference to the poultry industry.
  • Craig Rychel, Economic Officer in the U.S. Embassy in Panama will review the economic situation in Central America.  
  • Christine McCracken of Rabobank will discuss demand for chicken with special reference to outbreaks of African swine fever in China and other nations.
  • Dr. Paul Aho, a prominent agricultural economist will consider the potential impact of ASF for future markets.
  • Dr. John Clifford will review international agreements on Newcastle disease and avian influenza and the status of regionalization.

 

Dr. Mindy Brashears Confirmed by Committee as Undersecretary for Food Safety

05/21/2019

The Senate Agricultural Committee approved the nomination of Dr. Mindy Brashears as Undersecretary for Food Safety at the U.S. Department of Agriculture.

Mike Brown, president of the National Chicken Council stated “Dr. Brashears brings a wealth of food safety knowledge, a background in microbiology and experience to this position and we urge the full Senate to consider her nomination promptly”. He added “We look forward to working with her and continuing to work with the dedicated professionals at FSIS in advancing our common goal of protecting our public health and keeping our food supply as safe as possible”.

Dr. Brashears was nominated in 2018 but the 115th Congress did not consider a number of nominations, and accordingly Dr. Brashears was named as Deputy Undersecretary by Secretary Dr. Sonny Perdue allowing Dr. Brashears to commence official duties. No date has been set for a full Senate confirmation.


 

Japan Eases Restrictions on U.S. Beef

05/21/2019

In December 2003, Japan imposed restrictions on exports of U.S. beef based on a single case of sporadic bovine spongiform encephalopathy (SBE). In 2005, muscle cuts were acceptable for import into Japan derived from animals under 20 months of age. In 2013, the cut-off was advanced to 30 months. In 2017, Japan eliminated age-based testing for BSE which extended to trading partners. The Food Safety Commission of Japan decided in mid-January 2019 that age restrictions were no longer necessary and import requirements were aligned with guidelines of the World Organization for Animal Health.

The new policy on importation involving elimination of the 30-month age limit has made possible imports of U.S. and Canadian beef into Japan. The decision by authorities in Japan is consistent with science-based criteria. The U.S. Meat Export Federation projects exports to Japan to increase by $150 to $200 million per year as a result of the announcement.


 

USPOULTRY Foundation Grant for Welfare and Behavior

05/21/2019

USPOULTRY Foundation has approved a grant to the Mississippi State University entitled Evaluation of welfare, behavior and performance as affected by growth rate of broiler chickens.

The grant was in part funded by Pilgrim’s Pride Corp. Given interest in so-called slow- growing strains, and their possible deleterious effect on profitability and in myodystrophy in heavy birds. The selection of Mississippi State University to undertake research on this topic is commendable. It is hoped that results will be soon forthcoming and will be instrumental in establishing rationality with respect to growing both slow-growing and heavy broilers.


 

Hybrid Turkeys Recommends Upgrading Ventilation before Summer Heat

05/21/2019

William Alexander, technical Service Representative for Hybrid Turkeys published guidance to prepare for summer in tunnel-ventilated houses in the May 9th edition of The Flock.

 

The article includes standards for temperature and the effect on feed consumption and growth rate of growing flocks above 75 F. Alexander emphasizes the need to maintain fans and evaporative cooling when using tunnel ventilation. A wind-chill chart was included in the article to demonstrate the deleterious effect of reduced air-speed at high ambient temperature.  Ensuring that fans, controllers and sensors are functioning correctly will contribute to achieving the genetic potential of flocks during summer.

 

The complete article can be assessed on www.hendrix-genetics.com/flock


 

Val-Co® Launches E-Commerce Val-Co Store

05/21/2019

Val-Co has established an E-commerce website www.val-co.store to supply a range of watering, feeding, ventilation components and repair parts. New products include nipples, rebuild kits for regulators, bin bottom conversion kits, fans, vent actuators and numerous electronic components for ventilation, feeding and watering systems.


 

Shane Commentary

Tyson Foods to Pursue Plant-Based Meat Alternatives Independently

05/12/2019

Following the sale of their approximately seven percent equity stake in Beyond Meat, Tyson has announced that it will introduce a range of plant-based meat substitutes as an independent initiative. It is evident that Tyson obtained considerable knowledge of both production technology and the market for products through their association with Beyond Meat. Tyson probably also determined reasons for the suboptimal financial performance of the company and consider that they may capitalize on the market without the disadvantages of functioning as a start-up with growing competition.

The intention of Tyson Foods to move into the market as an independent was revealed by CEO Noel White at a quarterly analyst conference on Monday 6th May. It is intended that the Tyson product will launch towards the end of summer with a more extensive distribution during the 4th quarter.

Analysts project the meat substitute market in the U.S. to be worth $1.5 billion with a target of $2.5 billion by 2024. Beyond Meat will have a strong competitor in Impossible Foods. In a recent personal sampling of the product at a restaurant chain serving the product at Seatac airport, the Impossible Burger with an added haeme pigment derived from plants to provide juiciness was clearly inferior to a conventional beef burger. The menu item was served at a premium of $1 over a conventional menu item, possibly reflecting cost to the restaurant or a “feel-good” tax.

 

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