Date: November 19th, 2018
Cash feedlot trade wrapped up in the South at $114 live which is steady with the week previous. Trade in NE and IA though was steady to $2 lower at $112 to $113 live and $176 to $178 on a dressed basis. Lean hogs locked limit higher on news that China discovered their first case of African swine fever in a wild boar, another 4 cases reported on farms on Friday and China now stating it is having a very difficult time controlling the spread of the deadly disease.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – W/E 11/16/2018
RECEIPTS: Auctions Direct Video/Internet Total
This Week 307,700 29,100 31,600 368,400
Last Week 329,800 41,000 6,500 377,300
Last Year 320,200 26,600 2,200 349,000
Compared to last week, steers and heifers sold 2.00 to 6.00 lower. Over the course of this fall, feeder cattle buyers have been more stringent on health protocols of cattle on offer. Buyers now have orders that require calves have at least one, preferably two rounds of shots and be weaned 60 days or more. Feedlots have been content to be selective when it comes to purchasing those higher risk offerings. In the Northern Plains, cold weather with poor yard conditions and many crops still waiting to be harvested have put a damper on procuring bawling calves at this time. Buyers are glad to see a deep freeze early this week in sections of the country as ole man winter has officially arrived. Calves are getting used to the cold and won’t be subject to respiratory issues as much now.
For the week, Friday November 9th to Friday November 16th, December Live Cattle +$.77, February +$1.92, January Feeder Cattle +$2.72, March +$1.80, December Lean Hogs +$4.27, February +$7.25. Boxed Beef, Choice -$2.29 @ $212.91, Select -$1.15 @ $197.57.
Cattle slaughter for Friday estimated at 120,000 head, up 6,000 from the week previous and up 3,000 from last year. For the week, 641,000 head, up 1,000 from the week previous matching last year. Beef production at 526.3 million pounds last week compared to 526.4 the week previous and 530.3 last year.
Hog slaughter for Friday estimated at 472,000 head, down 1,000 from the week previous but up 16,000 compared to a year ago. For the week, 2,626,000 head, up 37,000 from the week previous and up 150,000 compared to a year ago. Pork production for the week at 555.2 million pounds compared to 545.7 million the week previous and 526.9 million last year.
Boxed beef cutout values weak on Choice and steady on Select on light to moderate demand and offerings for a total of 83 loads sold.
Choice Cutout__212.91 -.64
Select Cutout__197.57 -.01
CME Feeder Index:__147.83 -1.10
CME Lean Hog Index.__59.10 -.76
Pork Carcass Cutout__68.18 -.49
IA-S.MN Wtd Avg Live__N/A, Wtd Avg Carcass Base__51.24 +.32
National Wtd Avg Live__40.51 +.09, Wtd Avg Carcass Base__51.60 +.02
Cold Storage and Cattle on Feed coming out Wednesday at 11 am. The average pre report estimate for COF as of November 1st at 104% vs. a year ago. Placements for October expected to be at 99% vs. last year and Marketings at 104%.
December live cattle still holding premium to cash trade with support at $114.15 then $113.55 and resistance up near $117. January feeders bounced off the technical pivot point last week and stopped at the $148 resistance level with the next up at $151. December lean hogs again up the $3 limit with expanded limits today. $60.20 is the recent high from last month with resistance next up at $60.75 and $62.90 with support at $56.60.
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Grains were mixed last Friday as well as for the week. Soybeans showed the most life with continued positive news or chatter between the U.S. and China on resolving the current trade war. Brazil fob offers continue to plummet from their highs, today Z is off 15 to +145, G off 5 to +90. 3 weeks ago Z offers were +260 and the break from the highs represents trade sentiment that a deal between the US and China is near.
Weekly export sales fell within the range of market expectations with corn on the high end while beans and wheat were on the lower end. Meal sales were above expectations helping support a rally to end the week. Venezuela cancelled a cargo of HRW though which is disappointing but good to see Bangladesh in for 2 cargoes of HRS.
The CFTC Commitment of Traders Report showed managed money through last Tuesday -8.6k corn (net long 17.9k), +14.4k Chicago wheat (net short -26.6k), -12.4k KC Wheat (net short -1.2k), -9.9k soybeans (net short -55k), -17.4k soybean meal (net long 2k), -10.9k soybean oil (net short -70.1k).
For the week, Friday November 9th to Friday November 16th, December Corn -$.05, March -$.05 ½, January Soybeans +$.05 ½, March +$.05 ¾, December KC Wheat -$.04 ¾, March -$.02 ¾, December Chicago Wheat +$.04 ¾, March +$.03, December MPLS Wheat -$.02, December Soybean Meal +$5.30/T.
Grains were lower overnight with corn finishing ½ to 1 lower, soybeans 7 lower and wheat 1 to 4 lower.
South Korea purchased 69,000 MT or 2.7 MBU of optional origin corn. Saudi Arabia announced a purchase of 495,000 MT or 18.2 MBU or 12.5 pro hard milling wheat, still awaiting the origin breakdown. USDA also announced this morning a private sale of 138,000 MT or 5.4 MBU of corn sold to South Korea.
USDA will update crop progress and conditions later this afternoon. AgRural estimated 2018/19 Brazil soybean planting progress at 82% complete, that is above the year ago week’s 73% pace, and well ahead of the 67% pace long term average for this point in the season.
Some brutal storms lately in Argentina – heavy rain, flooding, and hail. Fortunately, only one-third of the corn has been planted, so the damage is likely not significant, other than forcing some re-planting of crops. Brazil crop weather is expected to be mostly good, although some areas in the north will become too wet in the coming week. Precip here in the U.S. remains light and towards the end of the week for the Eastern Corn Belt. The latest 6-10 day outlook though showing only below normal moisture for TX with temps above normal on both coasts and below normal for the central states.
December corn trading sideways recently with about a 20 cent range, support at $3.60 and resistance up at $3.79. January soybeans also rangebound from $8.44 ½ to $9.06 with good support building at $8.75. December KC wheat with a new low last week at $4.78 ¾, resistance up at $5.10. December Chicago wheat holding support near $5.01 and resistance at $5.21. December soybean meal with support from $304 to $303 with resistance up at $314.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700