coronavirus winners---

[albion]

On the news last night, some farmers cannot sell their products and are having to destroy their product. And at the same time the US meat supply is supposedly disappearing.


www.nasdaq.com/articles/brazils-jbs-quarterly-net-income-surges-332-beats-analysts-estimate-2020-03-25

By Ana Mano

SAO PAULO, March 25 (Reuters) - JBS SA JBSS3.SA, the world's largest meat-packer, on Wednesday reported its quarterly net profit soared 332% over the prior-year period, thanks to a surge in sales to China, which increased food imports dramatically after an outbreak of African swine fever.

The fourth-quarter net profit rose to 2.43 billion reais ($482.5 million), JBS said in an earnings statement.

The result beat analysts' forecasts for net income of 2.19 billion reais.

JBS executives told Reuters that the company is in a good place to navigate market turbulence amid the coronavirus pandemic.

JBS has been able to reduce debt over the past year and has no current need to raise additional capital, Chief Financial Officer Guilherme Cavalcanti said in a phone interview. The company expects to save $100 million in interest payments in 2020, he said.

"Happily we stretched debt maturities at the right moment," he said.

Chief Executive Officer Gilberto Tomazoni said demand from China will likely remain strong as supply disruptions caused by African swine fever persist.

Aside from that, Chinese cities are easing lockdowns related to the coronavirus pandemic, which should be positive for demand.

Tomazoni said JBS is ready to weather the storm stemming from the health crisis, given the company's diversified production base and seniority of management.

“Based on the size of the ship, it will rock more or less with the waves,” Tomazoni said in the interview.

Plans to list JBS shares in the United States remain a priority, though a timeline is uncertain given market jitters related to coronavirus, the CEO said.

For the fourth quarter, earnings before interest, taxes, depreciation and amortization, a measure of operating income, were 5.67 billion reais in the quarter, slightly higher than Refinitiv analysts' estimates of 5.53 billion reais.

According to the earnings statement, net revenue grew by almost 21% to 57 billion reais.

At its Brazil beef division, JBS said sales to China almost doubled, with volumes rising 61% while average prices grew by 23%.

In processed foods division Seara, net sales were 5.7 billion reais in the fourth quarter, up 23.9% from the previous year thanks to heated demand in domestic and foreign markets.

In 2019, JBS pork export volumes to China out of the United States rose 10% from the previous year, driven by demand from China chiefly in the second half.

U.S.-based Pilgrim's Pride, which sells poultry products, posted net sales almost 25% higher in the fourth quarter, totaling 12.6 billion reais, JBS said.

($1 = 5.0358 reais)

(Reporting by Ana Mano and Alberto Alerigi; Editing by Sandra Maler and Leslie Adler)

(([e-mail]; Tel: [phone]; Mob: [phone]; Reuters Messaging: [e-mail]))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

[almagata]

Funny, I was just looking at why beef prices were up today and found this article on modernfarmer.com.
______________

Lawsuits within the past year have accused these companies of conspiring to keep cattle prices low and beef prices high, in part by closing functional processing plants in order to artificially reduce supply. The price difference between the amount the big four pays for cattle and the amount they sell it for to consumers is sometimes referred to as “the spread.” The larger the spread, the bigger the profit—and those lawsuits allege illegal tactics to increase the size of that spread.

Now, with COVID-19 ravaging the country (and world, of course), that spread is getting larger. Beef sales have increased dramatically as consumers look to stock up on staples, especially those which freeze easily, like ground beef. Sales have spiked, along with wholesale prices, as grocery stores sprint to restock their shelves. One study finds that meat sales in general are up about 91 percent compared with this same week last year; just for beef, that equals more than $180 million in increased sales.

And yet despite all of this, live cattle prices are down 16 percent since February 4th. That discrepancy—the big four getting rich while the ranchers actually lose money—has prompted a rare bipartisan show of anger, with both Democrats and Republicans noting their displeasure and suspicion of this state of affairs. Secretary Perdue, to his credit, is aware of the problem, having at least tweeted about it:

Sec. Sonny Perdue
✔
@secretarysonny

.@usda is actively monitoring all ag commodity markets & the flow of food from FARM TO FORK during the COVID 19 outbreak. We are paying special attention to the difference in prices from the farm gate to the grocery shelf.
586
1:54 PM - Mar 22, 2020

In the meantime, there’s actually a way to avoid the big four altogether. R-CALF, a nonprofit cooperative of smaller beef producers, launched a website to make it easier to find local beef. (R-CALF is one of the groups that sued for antitrust violations last year.) Their site now provides a fairly extensive list of independent beef producers, along with phone numbers, websites, or other contact information. In short, it’s a Yellow Pages of non-big-four beef, a way to support producers outside that system.

That doesn’t, of course, help the ranchers who are stuck within the system, supplying those four companies. Systemic changes suggested by some Presidential candidates would address monopolies. In the meantime, hopefully the USDA has some bandwidth to see what’s going on here.

[albion]

I thought this a bit funny. The pandemic is producing a "favorable impact" on the market.



Global Respiratory Devices Market & COVID-19 Assessment 2020-2024 - Leading Players are Koninklijke Philips, Masimo, Invacare, ResMed, Fisher & Paykel Healthcare and Medtronic - ResearchAndMarkets.com
7:47 am ET May 14, 2020 (BusinessWire) Print

The "Global Respiratory Devices Market (Therapeutic, Diagnostic & Monitoring): Insights and Forecast with Potential Impact of COVID-19 (2020-2024)" report has been added to ResearchAndMarkets.com's offering.

The global respiratory devices market is forecasted to reach US$30.77 billion in 2024, growing at a CAGR of 5.93% for the period spanning 2020-2024.

In 2020, the outbreak of the COVID-19 pandemic has created a favorable impact on the respiratory market as the demand for masks, respirators, protective clothing, and gloves has increased significantly not limited to the healthcare sector but also to other industries.

[albion]

More Saudi investment during the Covid19 and oil crash. An oil crash that they and Russia helped create.



Saudi Foreign Reserves Drop in April on Wealth-Fund Transfer; Total foreign reserve assets fell by $24.7 billion as opportunistic stock-buying spree continues


By Stephen Kalin

RIYADH—Saudi Arabia's foreign reserves dropped sharply in April as the kingdom kept its peg with the U.S. dollar steady while transferring a chunk to its sovereign-wealth fund to bet on stocks beaten down by the coronavirus pandemic.

The kingdom's reserves in recent years have hovered around the $500 billion level, held by its central bank in mostly low-risk assets such as U.S. Treasurys. The implied stability allowed officials to maintain the Saudi riyal's peg to the dollar and demonstrate the kingdom's financial strength as it raised billions in debt to help fund an ambitious spending plan.

Total foreign reserve assets fell by $24.7 billion in April to about $448.6 billion, according to the latest data posted Sunday by the central bank, known as the Saudi Arabian Monetary Authority . They had fallen by $23.9 billion in March—the largest single-month drop going back two decades.

That decline came as the central bank transferred $40 billion to the Public Investment Fund over March and April for a buying spree of international stocks amid the financial fallout of the pandemic. Saudi Finance Minister Mohammed al-Jadaan has indicated the transfer was a one-off transaction to take advantage of the opportunity.

However, it opens the doors for further such disbursements and weakens the central bank's safety net as oil prices remain low and the pandemic drags on, analysts and bankers say.

"It's not as if, for example, there is a pocket of SAMA reserves that we know are never going to be touched as long as the peg is there," said Hasnain Malik, a Dubai-based emerging-markets equities strategist at Tellimer. "And we don't know how big PIF is going to be built up."

It is widely accepted, based on domestic money supply, that Saudi Arabia would need around $300 billion to maintain the peg. SAMA was forced to reiterate its commitment to the peg in May after March's decline prompted some investors to bet against it.

Moreover, Saudi Arabia needs the money to keep its economy ticking.

Under de facto ruler Crown Prince Mohammed bin Salman , the kingdom is attempting to reshape its oil-dependent economy by boosting the private sector. But the government still depends heavily on crude sales to help finance its budget. It is expected to draw down from foreign reserves to fill a deficit expected at nearly 13% of output this year due to low oil prices and the coronavirus-induced slowdown. In a sign of its precarious financial position, the government tripled its value-added tax rate, eliminated allowances for state workers and cut spending on headline projects.

Prince Mohammed tasked PIF in 2015 with diversifying the country's economy by investing in companies and industries untethered to hydrocarbons.

The centerpiece of that plan—selling 5% of state oil giant Aramco, known officially as Saudi Arabian Oil Co ., on an international exchange—was supposed to inject up to $100 billion into PIF's coffers for foreign acquisitions. After repeated delays, Aramco offered just 1.5% of its shares on the Riyadh bourse, generating about $30 billion .

"PIF couldn't do much with the proceeds of the Aramco share sale because the majority of this money came from the banking system inside Saudi Arabia," said Mazen al-Sudairi, head of research at Riyadh-based Al Rajhi Capital.

Another strategy to fund PIF's investments—selling the fund's stake in national petrochemicals firm Sabic to Aramco for $69.1 billion—also has fallen short as Aramco seeks to lower the valuation.

"The drop in foreign reserves was absorbable, and an injection from SAMA reserves was the fastest way to access cash," Mr. al-Sudairi added.

PIF in the first quarter bought roughly half-a-billion-dollar stakes in each of Facebook Inc ., Walt Disney Co . and Marriott International Inc ., according to a U.S. regulatory filing in May. It also acquired shares worth a similar amount in Cisco Systems Inc ., Citigroup Inc ., Bank of America Corp ., Carnival Corp . and Live Nation Entertainment Inc . It bought a stake worth $714 million in Boeing Co .

Most other sovereign-wealth funds in the region were also seeded with foreign reserves, but relatively high oil prices over the years ensured a steady inflow of U.S. dollars for their state owners. PIF itself received about $27 billion worth of riyals from the central bank in 2016.

The concern with PIF's bold strategy—piling into global stocks including in hard-hit industries like travel and entertainment, even as few other funds appear to be buying—is that it risks gambling away what is increasingly a finite pool of capital at the kingdom's disposal.

"The optics appear unhelpful given the recent announcement for a substantial hike in VAT and ongoing fiscal austerity," said Tarek Fadlallah, Middle East chief executive at Nomura Asset Management.

Write to Stephen Kalin at [e-mail]