Date: January 3rd, 2022
The year wrapped up on fairly light volume last Friday and somewhat quiet trading. Live cattle finished under mild pressure, feeders extended the week’s rally and lean hogs were triple digits lower wiping out gains made earlier in the week. Cash fed cattle trade popping higher this past week though. Trade in the North a firm $5 higher than the week previous at $140 live and $220 to $222 dressed. TX and KS live trade a bit disappointing, only compared to the early week NE trade, coming in at mostly $138 live, still $3 higher than the week previous.
For the week, Thursday December 23rd through Friday December 31st, December Live Cattle +$1.85, February +$.07, January Feeder Cattle +$3.42, March +$6.20, February Lean Hogs -$1.75, April +$.07.
Markets were open normal trading hours last Friday but USDA did not update any reports on Friday. It was announced this morning that federal offices in Washington DC are closed again today due to the winter storm, so we may not get reports today either.
Cattle slaughter from Thursday estimated at 117,000 head, matching the week previous with weekly total through Thursday at 475,000 head, down 3,000 from the week previous. Hog slaughter from Thursday estimated at 463,000 head, up 9,000 compared to the week previous with the weekly total through Thursday at 1,890,000 head, up 16,000 compared to the week previous.
Boxed beef cutout values on Thursday lower on Choice and higher on Select on light to moderate demand with 102 loads sold.
Choice Cutout__265.26 -.45
Select Cutout__258.23 +1.14
CME Feeder Cattle Index__163.55 from last Wednesday
CME Lean Hog Index__71.75 from last Wednesday
Pork Carcass Cutout __91.35 +7.06 from last Thursday, loins up $18+
National Wtd Avg Carcass Base__ 61.50 +.25
February live cattle now the front month and still holding a higher trend. The contract high was hit on November 29th at $141.85. Last week’s high topped at $141.42 with support at $138.40 then the December low at $135.50. January feeders remain choppy with resistance at $168.30 a gap left last week from $164.22 to $164.10 and support around $162 with the December low down at $158.40. February lean hogs chopping in a $14 range since June with nearby support around $80 and resistance at December’s high at $84.65.
Grains also mostly quiet trading to wrap up the month and the year. Wheat continued to be loss leader as some very beneficial winter weather moves into the Southern Plains heading into the weekend. Wheat the most volatile during the holidays with the nearby KC wheat contract down 60 cents last week after a 50 cent rally the week previous. Corn and soybeans quietly lower for the week as fundamental news remained scarce. South American extended forecasts showing some slight improvement but Argentina and southern Brazil remain mostly dry to begin the New Year.
For the week, Thursday December 23rd through Friday December 31st, March Corn -$.12 ½, May -$.12 ¼, January Soybeans -$.03 ¼, March -$.01 ½, March KC Wheat -$.60, July -$.48 ¾, March Chicago Wheat -$.44, July -$.36, March MPLS Wheat -$.50 ½, September -$.39 ½, January Soybean Meal +$5.60/T, March -$1.40/T.
Grains starting with a bump higher as corn finished the overnight 4 higher, soybeans 13 to 20 higher and wheat 1 to 7 higher. Equities are pointing higher this morning, energies were higher overnight but now steady to lower.
News light as the markets will continue to watch forecasts for South America and then the USDA final crop production report on January 12th. The Buenos Aires Grain Exchange updated corn crop conditions last week dropping good to excellent rated corn in Argentina 18 points from the week previous. Wheat harvest is near complete in Argentina with most looking for a slight increase in the production estimate.
Much below normal temps continue this week for the Northern Plains and WCB. Heavy rains in the PNW along with wintry mix in the Southeast. The 6-10 day outlook showing normal to above normal temps across the South with below normal in the Northeast and below normal moisture from the West Coast to the Corn Belt, above normal only in the Southeast. There were some spotty rains in South America over the weekend but the forecast returns dry for Argentina.
March corn still trending higher and able to get above the July 1st spike high last week before reversing lower with support at $5.92 and $5.80. The next upside target is the June 10th high on $6.33 then the contract high from May 7th at $6.40 ½. March soybeans hit a new 5-month high last week at $13.84 ½ with support at $13.35. This is the highest price since mid-July with resistance next up at $13.99. March KC wheat choppy the past couple months with resistance at $8.71 then the contract high from November 24th at $8.92 ¼ and support at $7.81. March Chicago wheat resistance around $8.20, the contract high up at $8.74 ¾ and support at $7.51. March MPLS wheat breaking the sideways pattern that had held since late October with a new recent low at $9.79 last week, support next around $9.50 and resistance at around $10.20. March Soybean Meal hit a new contract high last week at $415.10 with support at $398 then $396.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700