Date: November 28th, 2018
Cattle markets still looking for direction this week after a friendly COF report and higher cash feedlot trade last week. Technically both look bullish and still carrying higher trends over the past 2 weeks.
Oklahoma National Stockyards – Oklahoma City, OK
Livestock Weighted Average Report for 11/26/2018
Receipts Week Ago Year Ago
9,477 6,895 7,074
Compared to last week: 600-800 lb. feeder steers mostly steady to 4.00 higher. 600-700 lb. feeder heifers 2.00-3.00 higher, heavier weight steers over 800 lbs. 5.00 higher with a few sales up to 11.00 higher and heifers over 700 lbs. mostly 7.00 higher with a few sales up to 16.00 higher. Steer calves mostly 1.00-5.00 higher. Heifer calves 1.00-6.00 higher. Demand good to very good, especially good for cattle that will finish in April. Trade active. Quality average to attractive.
Tulsa Livestock Auction – Tulsa, OK
Feeder Cattle Weighted Average Report for 11/26/2018
Receipts: 3,143 Last Week: 2,978 Year Ago: 2,883
Compared to last week: Steers unevenly steady. Heifers unevenly steady with a slightly lower undertone noted on calves weighing less than 500 lbs. Demand good. Quality average to attractive. Supply included 26 percent over 600 lbs; 38 percent of the total receipts were heifers. Slaughter cows 2.00 higher. Slaughter bulls steady. A total of 403 cows and bulls sold with 54 percent going to packers.
Joplin Regional Stockyards – Carthage, MO
Livestock Auction Report for 11/26/2018
Receipts Week Ago Year Ago
9,990 6,410 5,377
Compared to last week, steer calves and yearlings 2.00 to 5.00 higher with limited comparisons of yearlings last week, heifer calves steady to 3.00 higher. Demand good, supply heavy. The offering mostly wean calves and yearlings. Weigh-ups average to full as a cold front moved into the trade area.
Winter Livestock Inc – La Junta, CO
Feeder Cattle Weighted Average Report for 11/27/2018
Receipts: 3056 Last Week: 1671 Year Ago: 3543
Compared with last Tuesday: Steer calves under 700 lbs 5.00 to 8.00 instances
10.00 higher, over 700 lbs 2.00 to 3.00 higher. Heifer calves under 600 lbs 1.00 to 2.00 higher, over 600 lbs steady. Slaughter cows steady to 1.00 higher. Slaughter bulls steady. Trade and Demand good.
OKC West – El Reno, OK
Livestock Weighted Average Report for 11/27/2018
Receipts Last Reported Year Ago
7,500 7,135 10,311
Compared to two weeks ago: Steer calves over 500 lbs sold 3.00-8.00 higher, under 500 sharply higher with instances of up to 13.00 higher. Heifer calves traded 2.00-4.00 higher. Demand good to very good. Heavy supply due to no sale last week because of the holiday. Several new buyers in attendance today filling wheat pasture needs.
Cattle slaughter for Tuesday estimated at 121,000 head, up 2,000 from last week and matching last year. Hog slaughter for Tuesday estimated at 469,000 head, down 10,000 from last week but up 8,000 compared to last year.
Boxed beef cutout values weak on Choice and firm on Select on light to moderate demand and offerings for a total of 140 loads sold.
Choice Cutout__214.00 -.45
Select Cutout__200.24 +.45
CME Feeder Index:__148.17 +.65
CME Lean Hog Index.__57.17 -.27
Pork Carcass Cutout__68.27 +.05
IA-S.MN Wtd Avg Carcass Base__49.02 -.18
National Wtd Avg Carcass Base__49.55 -.66
December live cattle trending higher since the recent low back on November 13th at $113.55 with resistance up at $117.42 then at $118.80. January feeders also on higher trend since the key reversal higher on November 13th. Support at $148 then $145.50 with resistance at $150 then up near $151. December lean hogs with a new recent high last week at $61.42 with the next resistance area from $62 to $62.90 and support being tested at $56.60 with the next at $54.
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Soybeans with a turnaround Tuesday as the markets feverishly await the meeting between the U.S. and China to be held this weekend at the G-20 summit in Argentina. China has only purchased one cargo of Brazilian beans for Feb, and one for March so far this week. They continue to buy on average about one cargo a day over the past month, when they normally buy about 7 a day. African swine fever and sourcing other protein sources has caused their demand for soy to drop these past few months. The window for U.S. soybeans to China is closing as new crop Brazilian beans will be available in the next 60 days. If the tariffs drop now, we could see 100 MBU exported to China but U.S. ending stocks will still be estimated over 700 MBU. Will the news be a positive shock to the market, absolutely but don’t get blinders on holding our hope for $10+ soybeans this year.
KC wheat continues making new lows, down over 50 cents in 3 weeks with mixed fundamental news adding along the entire trip lower. World wheat prices continue lower pulling U.S. values along with it as we desperately need some additional export sales. Corn was stuck yesterday in a tight range with support from soybeans and the pressure from wheat.
Overnight grains were higher with corn finishing 2 higher, soybeans 5 higher and wheat 1 to 4 higher.
USDA announced a private sale of 268,748 MT or 9.9 MBU of soybeans for delivery to unknown destinations. They also announced a correction for a cancellation of 180,000 MT or 6.6 MBU for delivery to unknown destinations originally cancelled by China back on October 19th.
Forecasts remain mostly favorable for South America. Argentina appears to be in for a nice mix of weather that will allow planting to continue while offering rain to some of the dryer areas. Argentine wheat has suffered from hail, frost, dryness, and now excessive rains. Forecasts call for rains over the northern Brazilian soy areas for the next week and over the western Argentine grain areas. International 6-10 day forecasts below normal precipitation for southern Brazil with normal temperatures and below normal precipitation for the north of Argentina with normal temperatures. U.S. 6-10 day outlook showing below normal temps for all except the Southeast and above normal precipitation in the forecast for all except in the Pacific Northwest.
First notice day for December grain contracts is this Friday. Please make sure to have positions exited or rolled forward by then as volume is decreasing and daily trading limits will not be in place starting Friday on the December contract. December corn on a lower trend these past few weeks, breaking the $3.60 support but holding the $3.55 level so far with the first line of resistance up at $3.65. January soybeans dipped below the convergence of all the major moving averages this week with support next at $8.45 and resistance up at $9. December KC wheat with a new low yesterday at $4.56 ¾ and a market very oversold, resistance up at $5.10. December Chicago wheat holding the $4.95 support and resistance at $5.21. December soybean meal in a $16 range so far this month, testing long term support near $300 this week.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700