US Perspective—05.08.08
Suspicions that big packer prices were finally succumbing to pressure were confirmed during the past week to ten days, as most selections have traded at at least a dollar below their last traded levels.
Unfortunately for packers, it appears that, at least for the moment, they were a bit too late conceding to the lower ideas from buyers, and we are hearing there was more than a reasonable amount of business that was not booked. These buyers are now re-adjusting their ideas even lower.
As far as trading levels go, we are hearing HNS are still able to bring as much as $69 for heavier material, while HTS are no better than $68, and BS are no better than $67. Meanwhile, BBS are struggling to trade at $68, while CBS appear to be trading at no better than $65. We have a few reports on heifers, which are lower as well, as HBH check in around the $56.50 levels, while HNH obtained no better than $58.50 last week.
The situation surrounding cows and bulls remains bleak as there are a number of rumors/horror stories accusing some producers in the States of allegedly offering them at very cheap levels for buyers who can purchase in volume and are willing to accept prompt shipment. For now, the trading levels we are able to confirm are HNDC trading at around the $52 mark and HNC at $48-$49. Meanwhile, pressure on HBC has been enough that producers are unable to keep these prices above the $40 level, as we have seen trading at $38.
Bulls are struggling as well with demand appearing as if it has almost fallen off the map. This has resulted in reports of producers attempting to move more than a normal amount of material and the consensus is that Native material will do well to maintain the last trading level at $58, while Branded material is struggling to stay above the $50 mark—we have trading as low as $51. For the time being, kips are trading in the $48-$49 range, while small packers are finding tough competition from large inventories of unsold render and machine damaged #3s. They are struggling to hold at around $48.
