Ag Master Report - Wednesday, Dec. 2

FEB CATTLE

Feb Cat recently rallied $6.00 (109-115) only to give back $3.00 (115-112) – such is the mkt action “pulled & pushed” by alternate “bad Covid news” & “good vaccine news”! It seems to be a “darkest before the dawn” scenario with the Covid resurgence creating some of the worst incidences around the country but at the same time, the promise of an effective vaccine just weeks away! So will the traditional Christmas beef demand kick in or be stymied by Covid! It’s really hard to say but when “all the smoke clears”, it seems the first quarter of 2021 will be an exceptionally good one for beef demand!!

FEB HOGS

Feb Hogs have experienced similar “back & forth” action as Feb Cat – rallying a quick $6 – then giving back $2 – & for the same reason! But the wildcard for the hog complex is the expected waning China demand-as the Chinese have aggressively rebuilt their hog herds thereby reducing their need for importing US pork! This import reduction will be gradual but will make it difficult for the mkt to absorb larger production into 2021! Hopefully, the vaccine-driven resurgence of the US economy in early 2021 will re-ignite domestic pork demand!

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