Date: April 1st, 2019
Cash feedlot trade somewhat disappointing last week yet expected with the dip in futures. NE trade was $126-$126.50 live and $205-$207 dressed, TX at $126 live and KS $125-$126 live.
Weekly export sales for beef were disappointing while pork sales were friendly. USDA reported the March Quarterly Hog and Pig Report that would typically be seen as very bearish with 2% higher across the board, but with the African swine fever in China and U.S. pork moving out the market should be able to absorb this continued expansion.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 03/29/2019
RECEIPTS: Auctions Direct Video/Internet Total
This Week 258,700 68,700 2,000 329,400
Last Week 256,100 90,300 28,800 375,200
Last Year 164,900 37,000 0 201,900
Compared to last week, steers and heifers sold steady to 5.00 higher. In many places that have been wet all winter long, the ground had started to dry early to mid-week giving way for pasture repairs and field work. Ranchers were trying to catch up and then beat another rain event late week by fertilizing pastures while the ground had some firmness to it. Warmer weather made its way through the mid-section of the country this week but more rain and moderated temperatures are forecasted for the weekend. Flooding is still a major issue in the Missouri and Mississippi Rivers and their tributaries and more surface water to run off is not going to help short term. When the warmer, dry weather finally decides to stick around, grills will start up and bring back summer beef demand.
For the week, Friday March 22nd to Friday March 29th, April Live Cattle -$4.02, June -$4.50, April Feeder Cattle -$3.55, August -$3.07, April Lean Hogs -$.95, June -$7.12. Boxed Beef, Choice -$3.05 @ $226.04, Select +$.25 @ $218.89.
Cattle slaughter from Friday estimated at 106,000 head, down 7,000 from the week previous but up 1,000 compared to a year ago. For the week, 614,000 head, down 17,000 from the week previous but up 24,000 compared to last year. Beef production last week estimated at 493.4 million pounds compared to 508.9 the week previous and 480.9 last year. Year to date slaughter up .6% from a year ago but beef production is down 1.0% due to lighter weights.
Hog slaughter from Friday estimated at 466,000 head, up 11,000 from the week previous and up 49,000 compared to a year ago. For the week, 2,509,000 head, up 13,000 from the week previous and up 133,000 from a year ago. Pork production last week estimated at 537.5 million pounds compared to 535.4 last week and 508.8 last year. Year to date slaughter up 2.5% and pork production up 2.8% compared to a year ago.
Boxed beef cutout values weak to lower on light demand and moderate offerings for a total of 92 loads sold.
Choice Cutout__226.04 -1.40, -3.05 for the week
Select Cutout__218.89 -.63, +.25 for the week
CME Feeder Index__141.74 -.61
CME Lean Hog Index__73.87 +2.15
Pork Carcass Cutout__81.33 +.12
IA-S.MN Wtd Avg Live Price__59.45 +.89, Wtd Avg Carcass Base__76.58 unch
National Wtd Avg Live Price__55.34 +1.29, Wtd Avg Carcass Base__74.89 -.48
April live cattle hit a new contract high at $130.45 but since has broken through the long term uptrend, below all major moving averages and hit a new 2 month low last Friday. The next support area is down near $123.50. April feeders still holding a higher trend with support at $143.50 and resistance up near $151. April lean hogs with a new contract high last week at $81.75, resistance next near $84 from last summer then $92.82 from July 2017.
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Over in the grains, prospective planting and quarterly stocks were bearish, even though we all know this data is form the first of the month and prior to any of the current Midwest flooding. It was also the end of the month and funds were net sellers most likely pushing their corn positions to a new record short level.
March Prospective Plantings (Million Acres)
USDA Private Estimates USDA Estimates
March 2019 Average Range March 2018 Final 2018
Corn 92.792 91.332 89.5 – 92.0 88.026 89.129
Soybeans 84.617 86.169 84.3 – 88.0 88.982 89.196
All Wheat 45.754 46.915 45.9 – 48.0 47.339 47.8
Winter 31.504 31.460 31.0 – 32.5 32.708 32.535
Spring 12.830 13.419 12.6 – 13.9 12.627 13.200
Durum 1.420 2.081 1.6 – 3.0 2.004 2.065
Cotton 13.780 14.498 14.1 – 15.4 13.469 14.099
Milo 5.135 5.777 5.4 – 6.5 5.932 5.690
Oats 2.555 2.747 2.5 – 3.0 2.716 2.746
Rice 2.870 2.801 2.6 – 3.0 2.690 2.946
Barley 2.550 2.560 2.286 2.543
Quarterly Stocks as of March 1 (Billion Bushels)
USDA Private Estimates USDA Estimates
March 2019 Average Range March 2018 Dec 2018
Corn 8.605 8.335 7.62 – 8.80 8.892 11.952
Soybeans 2.715 2.683 2.1 – 2.8 2.109 3.736
All Wheat 1.591 1.555 1.4 – 1.6 1.495 1.999
Milo 0.193 0.138 0.246
For the week, Friday March 22nd to Friday March 29th, May Corn -$.21 ¾, New Crop December -$.15 ¼, May Soybeans -$.19 ½, New Crop November -$.18 ½, May KC Wheat -$.15, New Crop July -$.15 ¾, May Chicago Wheat -$.08 ¼, New Crop July -$.07 ¼, May MPLS Wheat -$.17 ½, New Crop September -$.13, May Soybean Meal -$8.50/T, December -$7.10/T.
Overnight grains were mixed with corn finishing 1 to 2 higher, soybeans 4 to 5 higher and wheat steady to 1 lower.
South Korea purchased a total of 203,000 MT or 8 MBU of optional origin corn. USDA announce a private sale of 828,000 MT or 30.4 MBU of soybeans sold to China.
This week’s forecast calling for heavy rains in the PNW, Southeast and East Coast but still some scattered rains across the Midwest. The latest 6 to 10 day outlook showing above normal precipitation in the Northwest and Southeast and above normal temps for all.
May corn with a new contact low Friday at $3.56, support next at $3.52 ½ (March contract low) and resistance up near $3.80. May soybeans still holding a lower trend since February with resistance at $9.12 and support at $8.83. May KC wheat with resistance up at $4.54, contract low at $4.18 ¼. May Chicago wheat with resistance up at $4.78, contract low at $4.27. May soybean meal still choppy with resistance at $316.50 and support at $303.60.