Date: July 23rd, 2018
Cash feedlot trade was light and very late in the day on Friday at $114 live in KS, $3 higher than the week previous and at $180 dressed in the North, $5 higher.
July Cattle on Feed Report after the close on Friday was neutral with all coming in right at the average pre report estimates although all values were higher than year ago.
USDA Actual Average Guess Range
Cattle on Feed July 1 104% 104% 103%-106%
June Placements 101% 101.5% 96%-107%
June Marketings 101% 101% 99%-107%
Placement by Weight Class (expressed as % of previous year) Under 600 lb 107% 600-699 lb 110% 700-799 lb 90% 800-899 lb 98% 900-999 lb 109% Over 1000 lb 105%
Placements at 101% also equate to +17% larger than 2016. One less business day in June compared to May though means daily marketings were actually closer to 105%.
July 1 Cattle Inventory
All Cattle, Total Cows, Beef Cows & Total Heifers over 500# at 101% vs a year ago. Milk Cows and Milk Replacements at 100.0%. 2017 Calf Crop 102.0%
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – W/E 07/20/2018
RECEIPTS: Auctions Direct Video/Internet Total
This Week 158,300 78,700 5,400 242,400
Last Week 170,100 109,700 324,500 604,300
Last Year 121,300 67,100 234,900 423,300
Compared to last week, steers and heifers sold uneven; from 3.00 lower to 2.00 higher. Demand was good on moderate supply this week as the calendar is in the middle of the dog days of summer. Support in the cattle complex was evident this week with the sharply higher futures on Wednesday. Feeder cattle receipts typically are reduced this time of year, however the auction volumes on this report are 37K head above a year ago for this week and 20K for last week’s similar comparison.
For the week, Friday July 13th to Friday July 20th, August Live Cattle +$4.37, October +$2.87, August Feeder Cattle +$2.95, September +$3.47, August Lean Hogs -$3.70, October -$4.02.
Cattle slaughter from Friday is estimated at 119,000 head, up 1,000 from the week previous and up 4,000 compared to last year. For the week, 635,000 head, down 15,000 from the week previous but up 17,000 from last year. Beef production for the week at 511.3 million pounds last week compared to 521.3 million the week previous and 498.9 last year.
Hog slaughter from Friday is estimated at 434,000 head, down 4,000 from the week previous but up 9,000 compared to a year ago. For the week, 2,382,000 head, up 107,000 from the week previous and up 179,000 from last year.
Boxed beef cutout values steady to weak on light to moderate demand and light offerings for a total of 98 loads sold.
Choice Cutout__204.17 -.32
Select Cutout__197.00 +.08
CME Feeder Index:__148.02 -.29
CME Lean Hog Index.__77.83 -.79
Pork Carcass Cutout__80.86 -1.83
IA-S.MN Wtd Avg Live__ N/A, Wtd Avg Carcass Base__N/A
National Wtd Avg Live__ 53.34 -.81, Wtd Avg Carcass Base__68.07 -1.18
August live cattle into new recent highs with the next resistance level around $110. August feeders also into new highs at $154.92 with the next resistance up at $156 and support down at $150. August lean hogs still crashing lower this month hitting new contract lows with support next at $65 from the weekly continuous chart.
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Trade war is still getting the market chatter in the grains but last week Brazil’s basis moved to $2+ premium to the U.S. Argentina made some additional U.S. soybean purchase as Brazil continues to push all product to China. Funds are still net short corn and soybeans, adding to that again last week but now showing net long wheat.
For the week, Friday July 13th to Friday July 20th, September Corn +$.14, December +$.14 ¼, August Soybeans +$.31, November +$.30 ½, September KC Wheat +$.16 ¾, September Chicago Wheat +$.19.
Overnight, grains were steady to higher with corn finishing 1 higher, soybeans steady to ½ lower, KC and Chicago wheat 2 to 4 higher and MPLS spring wheat again the leader at 10 to 11 higher.
USDA announced a cancellation of a private sale of 165,000 MT or 6.1 MBU of new crop soybeans sold to China.
The heaviest rains this week, 2+ inches, is expected to fall in CO, KS and NE with light rains in the Midwest. The latest 6-10 day outlook showing above normal precipitation for the South and East, below normal in the Northwest. Temps are forecasted above normal West with a below normal bullseye on NE KS and stretching across most of the country.
September corn with support around $3.40 and resistance at $3.60 then up at $3.68. December corn down to $3.50 ¼ last week with resistance up at $3.80. August soybeans with support at $8.11, resistance up at $8.80 and then just above $9. November soybeans down to $8.26 ¼ last week with resistance at $9 and then $9.20. September KC wheat with good support at $4.70 and back to testing resistance overnight from $5.12 to $5.16. September Chicago wheat with support at $4.80, breaking through the $5.16 resistance areas with the next up at $5.54.