DTN Early Word Opening Livestock

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Cattle: Steady to $2 HR Futures: mixed     Live Equiv $142.56 + .56 *
Hogs: Steady     Futures: mixed    Lean Equiv $87.92 + $1.90 **
 
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue

GENERAL COMMENTS:

The cash cattle market seems set for a typically slow Tuesday with neither bids nor asking prices well define. Significant trade volume could easily be delayed until Thursday or Friday. Our guess is that some cattle will start out priced around $128 in the South and $202 plus in the North. We understand chain speed could drag somewhat through the week with at least one plant dark for scheduled maintenance. Live and feeder are likely to open on a mixed basis linked to a combo of follow-through selling and short covering.

Look for the country hog trade to open near steady. Preliminary slaughter estimates are around 2.3 million head. slightly larger than last week and 3-4 percent greater than last year. Lean futures should also open with uneven prices in light trade volume.

	BULL SIDE		BEAR SIDE
1)	Judging by new showlists circulated on Monday, fed cattle supplies remain very manageable. The early month offering looks generally steady with last week, larger in the South but smaller in the North.	1)	Neither the extraordinarily strong spot basis nor wide discount on June live futures are cash friendly realities, tempering resolve of feedlot managers to resist lower bids.
2)	After trimming their net long position in mid-February, noncommercials resumed building their commitment in live cattle futures commitment during the week ended February 28 (adding 1,820 contracts to 90,190).	2)	The index fund roll "officially" begins on this morning. Amid a historically large index fund position, live cattle buyers have been apprehensive and may well stay on the sidelines until the magnitude and impact of the fund roll is more apparent.
3)	The pork cut-out exploded higher on Monday thanks to strength in all primals. Buying energy was particularly evident relative to bellies and butts.	3)	Yesterday's moderate bounce in lean hog futures seemed little more than a dead cat bounce with virtually no technical significance.
4)	Lean hog futures prices are in the lower 7% of historical trading values currently, so there is definitely plenty of upside room should the fundamentals turn more supportive.	4)	Hog supplies are expected to remain ample through the late spring and that may keep the short-term market trend negative.

OTHER MARKET SENSITIVE NEWS

CATTLE: (industryleadersmagazine.com) --Last summer, the Impossible Burger emerged onto the food scene, when it debuted at restaurants in Manhattan, Los Angeles and San Francisco. The buzzed-about vegan burger is not your average burger. It looks, cooks, smells, sizzles and tastes just like meat, but was developed in a Silicon Valley lab and is a 100 percent plant-based indulgence. Famously known as "the burger that bleeds," the no-meat treat rose to fame when Chef David

Chang began serving at the Asia-Italian fusion restaurant Momofuku Nishi in NYC.

The Observer reveals that the Impossible Burger will be served "on a seeded bun topped with hot pepper aioli, white cheddar, watercress, frisée, and house-made relish, served with a side of crispy shoestring potatoes."

Big name investors like Bill Gates, Khosla Ventures and Google Ventures have bet $182 million into Impossible Foods, the company ehind the organic and all-natural patty. Around $108 million is going into a new factory in Oakland, California, where the company plans to produce products in high volumes later this month.

Patrick O. Brown and a team of scientists, engineers, chefs, farmers, foodies, and friends, spent nearly five years to make the vegan burger that bleeds. Bleeds? Yes, you read it right. The heme protein in the burger patty gives a deliciously meaty flavor and red color. It bleeds pink juices exactly like a real burger does. The company grows and then ferments the yeast to grow the heme protein. The patties have the look and feel of raw meet, they deliver the sizzle and explosion of aromas as they cook, the charred exterior, the red juices escaping, and the delicious meaty texture and taste when you sink your teeth into one.

The burger patties have the look and feel of raw meet, they deliver the sizzle and explosion of aromas as they cook, the charred exterior, the red juices escaping, and the delicious meaty texture and taste when you sink your teeth into one.

Most of its ingredients are sourced from within the United States. Its chief components are wheat protein, coconut oil, leghemoglobin (a soy-based protein), potato protein, sugar, xanthan gum, amino acids and Japanese yam.

Starting today, the Impossible Burger is on the menu at Bareburger with meat alternatives like the quinoa veggie patty. The chain will feature the burger at the flagship location on LaGuardia Place near NYC, but will potentially offer to all outlets once it Impossible. Burger churns out the meat substitute in big batches.

Bareburger is the first multiunit chain to feature the burger. Until now, the unconventional burger has debuted at Public, Saxon +Parole, two San Francisco restaurants, and one in Los Angeles. (At Saxon + Parole it will be served "topped with mushroom and truffle sauces, oyster mushrooms, sherry-braised onions, and lettuce, onion

and tomato.")

Impossible Foods is in talks with burger chains such as McDonald's, although the company may not be able to supply a customer base of that size until it ramps up production consistently.

The Silicon Valley patty startup has ample competitors, including Beyond Meat, the maker of plant-based meat substitute, which started selling its patty at a Whole Foods in Colorado last year.

Impossible Foods intends to introduce its long and delicious line of foods in other markets soon

HOGS: (globalmeatnews.com) -- China will dominate the global meat industry up to 2020, but transition will see pork production reshaped, poultry hit by trade restrictions and beef challenged by a rocky road.

Rabobank's new report on the outlook of China's meat industry up to 2020 highlights some of the key meat trends in the world's second-largest economy.

One thing is clear about China's meat industry for the next three years: meat imports for beef, pork and poultry are expected to continue rising, cementing China's position as the most important meat trader in the world.

If it is not already, China will be the focus for meat exporters everywhere. But as the country's single-digit economic growth slows,meat demand will cool, leading to a period of change.

"On the supply side, pork production will be reshaped, while poultry production faces uncertainty, and beef production will likely drop," said Chenjun Pan, China-based senior analyst of animal protein at Dutch firm Rabobank.

"As a consequence, meat imports are expected to increase steadily, further cementing China's role as the world's most significant meat importer."

On pork, the next three years will see production bases spring up in the north and the north-east. In the south, home to many rivers and lakes, construction of pork production factories will be limited.

Small producers and farmers could be squeezed out of the market, with further consolidation of larger companies. Pork is strategically import for the Chinese government. The introduction of an environmental tax suggests the government wants production to conform to environmental sustainability as China looks to lead the world on the Paris Agreement on climate change.

When it comes to beef production, a fall is expected this year, followed by two years of 1-2% growth. Consumer demand, especially from middle and high-income households, is expected to outpace domestic production, leading to a boom in beef imports. By 2020, imports will make up more than 20% of the country's beef supply.

China's ongoing reliance on imports of white-feathered breeding stock makes the country's poultry supply chain vulnerable to trading changes, Rabobank claims. Due to trade restrictions imposed on some of its biggest suppliers -- the Netherlands and Germany -- over Europe's H5N8 avian influenza outbreak, China's poultry production will fall in 2017.

Change across beef, pork and poultry will see varying levels of flux in Chinese meat production, but consumers will buy more meat than the country can produce. Imports will continue to rise.

Rabobank estimates meat imports to mainland China will reach 6m tonnes in 2020, firming up the country's position as a dominant player in the global meat industry.

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John Harrington can be contacted at john.harrington@dtn.com
For more from John Harrington, see www.feelofthemarket.com

(BAS)

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