Date: May 22nd, 2019
Cash feedlot trade so far this week very light at $115 live and $185 dressed matching the bottom end of last week’s trade. Fed Cattle Exchange online auction later this morning with 309 head consigned compared to last week’s 376 head of which 280 head sold at $117 from OK and KS.
Livestock futures were pressured most of the day yesterday with grains higher, specifically corn with its recent flip to the upside. In the past 7 trading sessions corn as recovered to within a half cent of this year’s high back on January 8th. There is a ton of congestion from current price levels to approximately a dime higher. For the time being it appears it will take an additional catalyst to move through this area or maybe just the forecasted weather for the Southern Plains and Midwest to come to fruition this week. Getting lost in the shuffle is the good trade news the past few days with Mexico lifting tariffs on U.S. pork and Japan eliminating the under 30-month rule for importing U.S. beef.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 5/20/2019 – Final
Receipts: 7,611 Last Week: 5,192 Last Year: 9,423
Compared to last week: Feeder steers 600-700 lbs. 2.00-3.00 lower, heavier weights mostly steady. Feeder heifers 2.00 lower with exception of 700-800 lbs. 1.00 higher. Steer calves 500-550 lbs. 3.00 lower, other weights not tested. Heifer calves lightly tested with a lower undertone noted.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 5/20/2019
Receipts: 6,137 Last Week: 3,601 Last Year: 6,425
Compared to last week, steer and heifer calves 2.00 to 6.00 lower, yearlings 2.00 to 3.00 lower.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 5/20/2019
Receipts: 1,939 Last Week: 1,549 Last Year: 2,317
Compared to last week: Steers 6.00-8.00 higher. Heifers mostly steady to 2.00 higher. Quality plain thru attractive. Demand good. Slaughter cows mostly steady to 1.00 lower. Slaughter bulls steady, in a light test.
Cattle slaughter from Tuesday estimated at 120,000 head, down 1,000 from last week and last year. Hog slaughter from Tuesday estimated at 470,000 head, up 10,000 from a week ago and up 9,000 compared to a year ago.
Boxed beef cutout values lower on light to moderate demand and offerings for a total of 138 loads sold.
Choice Cutout__219.58 -1.87
Select Cutout__206.58 -1.45
CME Feeder Index__132.17 +.35
CME Lean Hog Index__84.37 -.22
Pork Carcass Cutout__87.07 +.54
IA-S.MN Wtd Avg Live Price__64.29 no comp, Wtd Avg Carcass Base__82.13 +.23
National Wtd Avg Live Price__63.55 -.16, Wtd Avg Carcass Base__80.91 -.11
June live cattle with a new recent low last week at $109.05, holding the support from the lows back from this past fall and $107.50 the next support area, resistance at $112.50 then around $115.00. May feeders hit a new contract low at $132.42, hanging just above $134 this week and set to expire tomorrow. August hit a contract low last week at $140.50 with resistance at $146 then $148. June lean hogs found support at $85.37 two weeks ago still holding a higher trend and breaking the lower trend since the mid-April high at $99.82. Resistance next up at $93.80 with support right under the $90 level.
Over in the grains, again corn higher the past 7 trading sessions. Planting pace at a historical low with only 49% complete nationwide compared to last year’s 78% and 80% 5-year average. The ECB still the worst with IL at 24%, MI at 19%, IN at 14% and OH at 9%. Soybeans did a quick flip lower with rumors coming out yesterday that the administration plans to inject another round of MFP payments this year and up to $2/BU for soybean producers. Based on current over supply and a pullback in Chinese demand from African swine fever, the market continues to remind us that soybean production does not need to be added at this time. Wheat was mixed yesterday and is struggling with direction due to burdensome world stocks and price pressure vs. U.S. weather threatening not only production but quality here in the Southern Plains and supported by the rally in the corn market as wheat can compete for some feed usage.
Overnight, corn and wheat reversing lower with soybeans steady. Corn finished the overnight 2 to 4 lower, soybeans 1 to 2 higher and wheat 3 to 7 lower.
News overnight was very light, China telling its countrymen they must prepare for difficult times with the trade talks breaking down, EU and Russian crop estimates increasing, U.S. and Japan trade talks ongoing.
USDA announced this morning a privates sale of 131,000 MT or 4.8 MBU of soybeans for unknown destinations, 110,000 MT old crop and 21,000 MT new crop.
Severe weather threats and heavy rains continue and now in the forecast for the rest of this month for the Southern Plains and Corn Belt. The latest 6 to 10 day outlook showing above normal precipitation for all expect in the South with below normal temps west and above normal east.
July corn up to $3.99 yesterday, again a lot of congestion from there to $4.03 with support at $3.80. July soybeans broke the $8 barrier and down to a new contact low at $7.91 last week. July filled the gap left from earlier this month running up to $8.46 ½ yesterday with resistance at $8.48 and support at $8.19. July KC wheat up to $4.53 yesterday, resistance up near $4.60 with support at $4.24 then around the $4 mark. July Chicago wheat up to $4.92 ¾, resistance up at $5 with support around $4.55.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700