Date: July 1st, 2019
Cattle futures finished the week mixed trying to keep up with the volatile grain market and month end trading of its own. TX and KS cash feedlot trade reported at $109 live finally on Friday while in the North trade trickled in throughout the week from $110 to $112.50 live and $175 to $180 dressed.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 06/28/2019
RECEIPTS: Auctions Direct Video/Internet Total
This Week 156,200 35,700 46,100 238,000
Last Week 155,900 41,600 15,000 212,500
Year Ago 182,800 47,400 66,800 297,000
Compared to last week, steers and heifers sold uneven; 3.00 lower to 3.00 higher. There were instances of auctions in the North Central area calling their markets up to 8.00 to 10.00 higher on some in demand weight groups. Many loads of yearlings were in the supply this week as several barns held pre-Fourth of July special sales. Most cattle this week on hand at auctions were very high quality and found good demand. Cattle feeders had the opportunity to make like-kind purchases this week and they were willing to step in this week and own them, especially after the CME Cattle Complex moved sharply higher on Wednesday.
For the week, Friday June 21st through Friday June 28th, June Live Cattle +$3.95, August +$2.12, October +$1.27, August Feeder Cattle +$3.17, September +$2.65, July Lean Hogs -$4.15, August -$1.90. Boxed Beef Choice -$.16 @ $219.66, Select -$3.99 @ 195.56. Pork Carcass Cutout -$2.89 @ $73.84.
Cattle slaughter from Friday estimated at 120,000 head, up 2,000 from the previous week and matching the total from last year. For the week, 665,000 head, up 3,000 from the week previous and up 6,000 from a year ago. Beef production estimated at 525.7 million pounds last week compared to 522.3 the week previous and 521.5 last year. Year to date slaughter running 1.2% ahead of last year while beef production is up .1%.
Hog slaughter from Friday estimated at 452,000 head, down 10,000 from the week previous but up 22,000 compared to a year ago. For the week, 2,384,000 head, down 65,000 from the week previous but up 146,000 compared to a year ago. Pork production estimated at 510.8 million pounds last week compared to 524.9 the week previous and 465.1 last year. Year to date slaughter running 3.2% ahead of year ago with pork production up 3.8%.
Boxed beef cutout values firm on Choice and lower on Select on moderate demand and moderate to heavy offerings for a total of 126 loads sold.
Choice Cutout__219.66 +.63
Select Cutout__195.56 -1.34
CME Feeder Index__132.61 +.74
CME Lean Hog Index__76.05 -1.21
Pork Carcass Cutout__73.84 -.35
IA-S.MN Wtd Avg Live Price__N/A, Wtd Avg Carcass Base__69.06 -.80
National Wtd Avg Live Price__53.96 -1.68, Wtd Avg Carcass Base__68.18 -.96
August live cattle now the front month starting at nearly $6 discount to cash. August hit a new contract low last Monday at $101.97 with resistance up at $107.17, the June high, then up at $110. The weekly nearby low from last year was down at $101.37. August feeders also into a new contract low last Monday at $130.95 with support next at $128.57, the nearby weekly low from last year, resistance up at $141 then $146. July lean hogs into a new recent low on Friday at $72.00 with the contact low down at $70.05 and resistance up near $84.
Over in the grains, the fireworks show was Friday with markets closed this Thursday for Independence Day. Grains were steady to slightly higher heading into the 11 am release by USDA of its June Acreage and Quarterly Stocks report. Corn punched lower, touching limit lower at one point, as USDA reported 91.7 million acres of corn to be planted based off early June producer surveys. This is below the March intentions at 92.8 but the pre report trade estimate was at 86.6 million. Quarterly stocks were actually friendly at 5.202 BBU compared to expectations and last June’s 5.3 BBU. Winter wheat acreage was increased by 274,000 acres but spring wheat and durum acres reduced by 419,000 and all wheat ending stocks reduced 27 MBU. Wheat is still a corn follower though as the market keeps a close watch on the feed usage for both. Soybeans were the bright spot with USDA reporting only 80 million acres of soybeans to be planted compared to 84.6 million on the March intentions and the market expected to see 84.3 million. Soybean stocks were also below expectations at 1.79 BBU yet still a new record for June 1st at 571 MBU greater than a year ago. The COT report through last Tuesday showed some additional length by the funds to corn and still net short soybeans.
For the week, Friday June 21st through Friday June 28th, July Corn -$.22, September -$.22 ¾, December -$.22, July Soybeans -$.03, August -$.04, November -$.04 ½, July KC Wheat -$.01, September -$.03, December -$.03, July Chicago Wheat +$.02, September -$.03 ½, December -$.03, July MPLS Wheat +$.18 ¼, September +$.10 ¼, December +$.10 ¾, July Soybean Meal -$2.50/T, August -$1.70/T, December -$1.30/T.
Overnight, grains were mixed with corn finishing 2 to 3 lower, soybeans 3 to 4 higher and wheat 5 to 7 lower.
The trade war between the U.S. and China is not over yet but both sides said talks this past weekend at the G-20 summit were productive. The U.S. will not impose any additional tariffs at this time and China committed to buying additional Ag products as negotiations continue.
Day 3 of the KS Wheat Harvest Report was released on Sunday by the KS Wheat Comm and KAWG. “Harvest picked up momentum and began to move quickly over the weekend. It has reached many areas across the southern and central parts of the state. With the exception of the northwest, most areas are mature, and only the wet ground is keeping some farmers from the fields.”
USDA will update crop progress and conditions this afternoon. Corn and soybean conditions as well as soybean planting completion will be the hot topics. Most are expecting unchanged to maybe a point a two lower for conditions.
There were some heavy rains over the weekend in the Northern Plains and sweeping down into the ECB. This week’s forecast calling for additional heavy rains in the Dakota’s, MN and IA with 1 inch scattered rains possible from NE through OH. The latest 6 to 10 day and 8 to 14 day outlooks still showing above normal precip for most major growing areas with above normal temps in the Southeast and PNW.
September corn with a massive reversal lower Friday with support next near $4.16, December at $4.25. August soybeans still holding a higher trend since hitting the contract low at $7.97 ¾ back on May 13th. Nearby support at $8.90 with resistance around $9.30. September KC wheat chopping sideways over this past month with support near $4.50 and resistance up at $4.87 then $5.00. September Chicago wheat still holding a higher trend with support at $5.30 and resistance up near $5.55. August Soybean Meal with support at $310 and resistance up at $329.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700