rounded corner
rounded corner
top border

China And The US Moving Toward Common Ground

Bookmark and Share

By Dennis Smith

Follow me on Twitter @denniscattle

Thursday September 12, 2019


The U.S. government and China are both moving closer to common ground, perhaps were approaching some kind of cease fire, some kind of tariff rollback. The issues are extremely thorny, extremely complicated. A resolution early next month is extremely unlikely but some sort of pause in the despite appears highly likely. Export sales were solid at 21,900 MT with China the biggest buyer, booking 10,900 MT. Our other traditional buyers were small buyers with total sales up 3% from the 4-week average. Shipments were 20,900, actually down 17% from the 4-week average. China only shipped 5,100 MT last week. With record large production coming down the pipe, this is a bit of a problem. Futures are bid sharply higher. Many are quick to call this a major bottom. Perhaps. However, consider a sharply higher early trade a hedging opportunity for Oct and Dec production. As for next year, were leaving all production unhedged as its rather obvious that Asia is going to need massive amounts of U.S. pork eventually. Cash will be called lower.


Weekly beef export sales would have been nearly non-existent had Hong Kong not purchased 11,100 MT last week. Total sales, at 18,000 MT were thus up 11% from the 4-week average. Shipments at 14,600 were down 7% from the 4-week average. The volume of direct steer trade remains very light this week, starting out very low at 97 cents and firming up to 99 cents with some $1.00 trade in NE and some $1.02 in IA. Please note that all the cash transactions are lower than last week. Choice beef was down $5.49. Futures volume was large yesterday at 127,300 with open interest up 1,800. Cattle may get some traction from a sharply higher early trade in hogs, but look for selling, aggressive selling to likely develop at some point during the first hour of trade. IMO its extremely unlikely that packers are going to have to chase to secure inventory in the weeks ahead.

For a free 30-day trial to the evening livestock wire please send an email to:

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The risk of loss in trading futures and options can be substantial. Past results are not indicative of future results or performance. The views and opinions expressed in this letter are those of the author and do not reflect the views of ADM Investor Services, Inc. or its staff. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc. This matter is intended to be a solicitation.

Recent articles from this author

About the author

Dennis Smith has been a full service commodity broker specializing in grain and livestock trading for over 25 years. Dennis has a wide range of customers, many of whom are grain and livestock producers. Dennis develops and helps execute hedging and speculative strategies in his Daily Livestock Wire which is prepared each afternoon exclusively for his customers.

Dennis grew up in Central Illinois before launching his brokerage career.

Published by Barchart
Home  •  Charts & Quotes  •  Commentary  •  Authors  •  Education  •  Broker Search  •  Trading Tools  •  Help  •  Contact  •  Advertise With Us  •  Commodities
Markets: Currencies  •   Energies  •   Financials  •   Grains  •   Indices  •   Meats  •   Metals  •   Softs

The information contained on is believed to be accurate but is not guaranteed. Market data is furnished on an exchange delayed basis by Data transmission or omissions shall not be made the basis for any claim, demand or cause for action. No information on the site, nor any opinion expressed, constitutes a solicitation of the purchase or sale of any futures or options contracts. is not a broker, nor does it have an affiliation with any broker.

Copyright ©2005-2020, a product. All rights reserved.

About Us  •   Sitemap  •   Terms of Use  •   Privacy Policy