Date: February 6th, 2019
Feeders and hogs had an inside trading day yesterday after the triple digit gains Monday while live cattle futures look the healthiest building on small gains after finding support last week just below $125 and continuing the higher trend. Only a few hundred head of fat cattle have traded thus far this week in IA at $197 to $198 dressed. The Fed Cattle Exchange online auction later this morning only has 294 head consigned after the last couple weeks of decent numbers but little to no movement. It wouldn’t surprise me to see higher cash feedlot trade this week with a jump in beef prices, increased volume in exports, smaller show lists and an expectation for slaughter volume to move higher this week.
Tulsa Livestock Auction – Tulsa, OK
Feeder Cattle Weighted Average Report for 02/04/2019
Receipts: 2724 Last Week: 2352 Year Ago: 1566
Compared to last week: Steers 5.00-9.00 higher. Heifers 4.00-6.00 higher. Slaughter cows 3.00-5.00 higher. Slaughter bulls 2.00 lower.
Oklahoma National Stockyards – Oklahoma City, OK
Livestock Weighted Average Report for 2/4/2019
Receipts Week Ago Year Ago
11,838 10,629 9,442
Compared to last week: Feeder steers and heifers 600-700 lbs. steady to 2.00 higher, balance of heavier steers steady to 1.00 lower and heavier heifers 1.00-3.00 lower. Steer calves steady to 2.00 lower. Heifer calves mostly steady to 2.00 higher.
Joplin Regional Stockyards – Carthage, MO
Livestock Weighted Average Report for 2/4/2019
Receipts Week Ago Year Ago
8,142 7,334 4,467
Compared to last week, steers under 500 lbs 3.00 to 7.00 higher, 500 to 800 lbs steady to 3.00 higher, steers over 800 lbs steady, heifers steady, except yearling heifers 700 to 850 lbs steady to 5.00 higher.
OKC West Livestock Market – El Reno, OK
Livestock Weighted Average Report for 2/5/2019
Receipts Week Ago Year Ago
3,000 9,836 11,772
*** Final report including feeder cattle will be released 02-06-19 ***
Compared to last Tuesday: Steer calves sold 1.00-3.00 lower, heifer calves traded 1.00-2.00 higher. Demand remains good for grazing cattle.
Winter Livestock Inc – La Junta, CO
Feeder Cattle Weighted Average Report for 02/05/2019
Receipts: 2936 Last Week: 2547 Year Ago: 2194
Compared with last Tuesday: Feeder steers under 700 lbs mostly steady except for 500 to 550 lbs and 650 to 700 lbs 3.00 to 5.00 higher. Feeder heifers under 700 lbs steady to 2.00 higher advance on 450-500 lbs. Yearling feeder steers over 700 lbs steady to 2.00 higher, instances 5.00 higher on a load of thin fleshed fancy 720 lb steers. Yearling feeder heifers over 700 lbs mostly steady. Slaughter cows steady to 1.00 higher. Slaughter bulls steady.
Cattle slaughter from Tuesday estimated at 118,000 head, down 1,000 from last week but up 1,000 compared to a year ago. Hog slaughter from Tuesday estimated at 478,000 head, up 12,000 from a week ago and up 16,000 compared to a year ago.
Boxed beef cutout values weak on light to moderate demand and offerings for a total of 127 loads sold.
Choice Cutout__217.02 -.63
Select Cutout__213.10 -.31
CME Feeder Index__141.54 +.53
CME Lean Hog Index__57.36 -.05
Pork Carcass Cutout__66.22 -1.90
IA-S.MN Wtd Avg Live Price__40.78 no comp, Wtd Avg Carcass Base__49.93 +.23
National Wtd Avg Live Price__40.84 +.50, Wtd Avg Carcass Base__50.16 -.39
February live cattle holding firm after a dip below the higher trend line to end last week. The contract high is up at $127.95 with the next area of resistance up near $130 from the weekly charts and going back to last February. Support is at $124.70 then down around $123. March feeders have been choppy from $140.35 to $147.57 over these past few months, still carrying a long term lower trend since setting the contract high at $155.50 back on October 2nd. February lean hogs holding support just above $56 so far with support next down at $52 and a lower trend in place since mid-November.
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Over in the grains, buy the rumor and sell the fact as more soybeans confirmed sold to China but still not up to the 5 MMT quoted by Chinese officials last week. Over the last 2 days a total of 3.215 MMT or 118.1 MBU of U.S. soybeans have been sold to China with another 274K MT or 10 MBU sold for unknown destinations. Grains spent most of the day fractionally lower but corn and soybeans caught a bid late in the day to end with small gains. This market is coiled up and ready to strike as it feverishly awaits some new news to trade which will come at us on a Friday with a handful of grain reports from USDA.
Wheat spreads or carry continues to narrow as hard wheat export bids continue to firm. This should lead to or already means that some business is getting done especially with Russian wheat prices higher and stocks tight. World freight rates have also been falling recently allowing U.S. wheat to once again be competitive in the world market place if not the cheapest in the world currently. These are all good signs but we still have to see action in the export sales reports as they get updated by USDA this month and in export inspections. There are only 17 weeks left in the marketing year for wheat and to meet the current USDA export estimate of 1 BBU we have to see shipments over 26 MBU per week between now and then.
Overnight grains were very quiet with penny ranges in corn, 2 cent range in soybeans and 3 to 4 cent range in wheat will all finishing steady to 1 lower.
USDA MONTHLY CROP REPORT ESTIMATES…
US Corn 2018 production estimated at 14.532 BBU, compared to the 14.626 BBU in the November report. Yields last season are seen at 177.9 BPA, compared to the 178.9 BPA with harvested acres estimated at 81.68 mln
US Soybean 2018 production estimated at 4.569 BBU, compared to the 4.600 BBU in the November report. Yields last season are seen at 51.8 BPA, compared to the 52.1 BPA with harvested acres are seen at 88.187 mln
US 18/19 Corn ending stocks at 1.708 BBU vs. 1.781 in December
US 18/19 Soybean ending stocks at 925 MBU vs. 955 in December
US 18/19 Wheat ending stocks at 989 MBU vs. 975 in December
World Corn ending stocks at 307.06 MMT compared to 308.80 MMT in December
World Soybean ending stocks at 112.67 MMT compared to 115.33 in December
World Wheat ending stocks at 268.1 MMT compared to 268.1 MMT in December
Argentina 18/19 Corn production is forecast at 43.1 MMT compared to the 42.50 MMT in the December report. Brazil 18/19 Corn output is seen at 93.4 MMT compared to 94.5 MMT in December
Argentina 18/19 Soybean production is forecast at 55.14 MMT compared to the 55.5 MMT in the December report. Brazil 18/19 soybean output is seen at 117.00 MMT compared to 122.0 MMT in December
US Corn stocks as of Dec 1, 2018 at 12.090 BBU compared to the 2.140 BBU on Sept 1 and the 12.567 BBU on Dec 1, 2017
US Soybean stocks as of Dec 1, 2018 at 3.743 BBU compared to the 438 MBU on Sept 1 and the 3.161 BBU on Dec 1, 2017
US Wheat stocks as of Dec 1, 2018 at 1.957 BBU compared to the 2.379 BBU on Sept 1 and the 1.873 BBU on Dec 1, 2017
USDA Winter Wheat report to show 32.128 mln acres of winter wheat to have been planted, that compares to the year earlier 32.535 mln. HRW acres at 22.579 mln, SRW acres at 5.963 mln, and white wheat acres at 3.488 mln acres for 2019.
USDA announced a private sale of 523,000 MT or 19.2 MBU of old crop soybeans sold to China, 63,000 MT or 2.3 MBU of new crop soybeans to China and 182,000 MT or 6.7 MBU of old crop soybeans sold for unknown destinations. This brings the total for the week up to 4.2 MMT old crop soybeans sold.
Heavy snow and another round of arctic temps creep into the Northern Plains this week, below normal temps locally but precip should be light then heavy rains expected in the Southeast into the weekend. The latest 6 to 10 day outlook still showing below normal temps in the North and West with above normal for the Southeast and above normal precip for all.
March corn rangebound since late September from $3.67 to $3.90 and squeezing tighter with nearby support at $3.75 and resistance from $3.82 to $3.84 ½. March soybeans with a new recent high last week at $9.31 ¼ and still holding the long term higher trend from this fall with support at $8.90 and resistance at $9.41. March KC wheat breaking the long term lower trend but chopping sideways from the contract low at $4.82 ¼ up to $5.24 ½. March Chicago wheat holding a sideways pattern with support at $5.01 and resistance up at $5.38 ½. March soybean meal trending lower over this past month with support being tested currently and resistance up at $313 then around $317.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700