Date: June 24th, 2020
Livestock futures trading mostly higher yesterday. The China rumors swirling again that they will buy large quantities of U.S. Ag products helped push deferred cattle and hog futures higher. Light cash feedlot trade so far this week ranging from $3 to $7 lower than last week at $95 to $98 live in the South and $152 to $155 on a dressed basis in the North. The Fed Cattle Exchange online auction will be held later today with 1,221 head consigned compared to last week’s 1,220 head of which none sold and offers were listed at $101 to $102.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 6/22/2020
Total Receipts: 5,711 Last Week: 6,100 Last Year: 10,718
Compared to last week, steer and heifer calves and yearling heifers 2.00 to 5.00 lower, yearlings steers steady. Demand and supply moderate.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 6/22/2020
Total Receipts: 7,889 Last Week: 9,526 Last Year: 7,121
Compared to last week: Feeder steers were mixed. Steers under 800 lbs sold 1.00-3.00 lower; over 800 lbs steady to 2.00 higher. Steer calves 1.00-4.00 lower. Feeder heifers and heifer calves steady to 2.00 lower.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 6/22/2020
Total Receipts: 2,028 Last Week: 2,355 Last Year: 1,249
Compared to last week: Steers 5.00-6.00 higher. Heifers 6.00-8.00 lower. Quality mostly plain, few attractive. Demand good. Slaughter cows 1.00 lower, in a light test. Slaughter bulls 1.00 higher, also in a light test.
Cattle slaughter from Tuesday estimated at 120,000 head, up 1,000 from last week but down 3,000 from last year. Hog slaughter from Tuesday estimated at 468,000 head, up 10,000 compared to last week but down 5,000 compared to a year ago.
Boxed beef cutout values continue lower with 205 loads sold on Tuesday.
Choice Cutout__211.81 -2.25
Select Cutout__203.57 -.73
CME Feeder Index__128.71 -.41
CME Lean Hog Index__45.17 +.11
Pork Carcass Cutout__63.18 -1.66
IA-S.MN Wtd Avg Carcass Base__28.55 +.62
National Wtd Avg Carcass Base__28.36 +.11
Outside markets under pressure overnight with equites and energies lower and the US$ higher. June live cattle tested the lows from earlier month and nearby support at $93.35 even though cash is still premium so far this week. We should trade from $92 to $95 until expiration unless the cash feedlot trade pulls back even further. August feeders with a key reversal higher yesterday yet resistance still in place from $136.50 t $138.80. Monday I talked about a possible breakout has the daily trading ranges have become tighter and squeezing the chart. This could be the start of that breakout, but would still need to be confirmed with new recent highs. July lean hogs into a new contract low Monday at $45.75 with support next down at $37 and resistance up around $53.
Fall crops pulled back some more yesterday as wheat tries to stabilize. Fall crop conditions have improved and nearby forecasts are not threatening causing the pressure on futures so far this week. The China rumors remain just that as they have been buying a lot of new crop beans and continue to take a lot of grain sorghum, but we have not seen a large purchase of corn or wheat. Ethanol plants are back up to near 80% of capacity which helps pull corn, but just like the livestock side, the backlog will take some time to grind through.
Overnight, grains were flat as news was very light. Corn and soybeans finished steady to fractionally higher with wheat 1 lower to 2 higher.
China is now asking for gain and food companies to submit certification that their exported products are COVID free. Tyson Foods stated they have complied and signed these documents with the Chinese in hopes they will lift the current poultry ban in place on their Springdale, AR plant. No morning sales announced by USDA this morning.
Heavy rains showing now for the majority of the Corn Belt towards the end of this week and into early next week. The 6-10 day outlook still showing above normal temps for the central and eastern half of the U.S. with below normal in the West. Above normal precipitation also still showing for all areas except in the Southwest and Northeast.
July corn still holding a slow moving higher trend since mid-April. The contract low is down at $3.09, nearby support at $3.23 with resistance at $3.35. July soybeans breaking higher earlier this month into another range bound trading pattern with support at $8.64 and resistance at $8.80. July KC wheat trying to hold support at $4.26 with resistance at $4.50. July Chicago wheat hit a new recent low last week at $4.76 with support next the contract low at $4.68 ¼ and resistance at $4.95 then $5.04.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700