Date: August 21st, 2019
Livestock trade was sharply higher again Tuesday, but yesterday’s triple digit gains held for live cattle, feeders still slipped back from $2+ higher to finish with small gains. Lean hogs held decent gains but still holding a lower trend. Salebarn activity is picking back up after the market collapsed last week but still slow with triple digit heat this week. Cash feedlot trade at a standstill so far this week with larger showlists reported available. The Fed Cattle Exchange online auction will be held later this morning with 426 head consigned.
OKC West Livestock Auction – El Reno, OK
Livestock Weighted Average Report for 8/20/2019 – Final report including feeder cattle will be released later today
Calf Receipts: 700 Last Week Total: 3,465 Last Year Total: 8,311
Compared to last Tuesday: Steer and heifer calves were too lightly tested for an accurate trend, however a higher undertone is noted. Demand moderate to good. Quality average to plain.
McAlester Union Livestock Auction – McAlester, OK
Livestock Weighted Average Report for 8/20/2019
Total Receipts: 1,270 Last Week: 1,400 Last Year: 1,800
Compared to last week; Steer calves 5.00 to 7.00 lower. Heifer calves 2.00 to 7.00 higher. Demand was light to moderate. Quality was average.
Cattle slaughter from Tuesday estimated at 116,000 head, matching last Tuesday but down 2,000 from last year. Hog slaughter from Tuesday estimated at 482,000 head, up 6,000 compared to a week ago and up 17,000 compared to a year ago.
Boxed beef cutout values higher on Choice and steady on Select on moderate to fairly good demand and light offerings for a total of 94 loads sold.
Choice Cutout__241.70 +2.57
Select Cutout__214.27 -.25
CME Feeder Index__137.24 +.91
CME Lean Hog Index__77.99 -.56
Pork Carcass Cutout__83.91 -1.07
IA-S.MN Wtd Avg Live Price__54.81 -.85, Wtd Avg Carcass Base__70.53 -1.38
National Wtd Avg Live Price__54.50 +.47, Wtd Avg Carcass Base__69.18 -.53
USDA will release its Monthly Cold Storage report tomorrow after the close and Cattle on Feed Friday. The average estimate for cattle on feed as of August 1st is at 100.6% with July placements at 99.5% and marketings at 106.8% compared to a year ago.
August live cattle into a new contract low at $99.70 last week, the first time a nearby contract has been below the $100 level since October of 2016. Support is down at $94.30 with a new recent high yesterday at $102.15, a gap from there up to $105.05, followed by another up to $107.55, the 2 limit lower moves from last Monday and Tuesday. August feeders with a new contract low down at $127.65 but since has filled one gap and nearly the next with a gap remaining from $137.77 up to $138.65. October lean hogs holding a long term lower trend with choppy/sideways trade so far this month from $61.50 to $70.82.
Grains started higher and what appeared to be a recovery day ending up being another down day for corn and wheat pulling soybeans back to penny gains. The slip in crop ratings and friendly perspective on the crop from the Pro Farmer Tour were not enough to get bulls reinvigorated. The actual corn yield numbers presented for SD and OH at 154.1 and 154.4 respectively just didn’t spell out enough of disastrous situation. They are sharply lower from last year but near the average estimates from years past. The soybean pod counts though were down 19% in SD and down 39% in OH. The other news of the day was negative with POET, one of the largest US ethanol producers confirming trade rumors that began when the 31 SRE’s were announced that they will idle one ECB plants and run at reduced rates at half of their other facilities. That is calculated at near 2% of the total U.S. capacity but we are currently running some 6 to 7% below recent highs.
After the close, Pro Farmer released their estimates for NE and IN with both showing decreases from a year ago but for corn they are nearly the same drop that USDA published earlier this month and for soybeans considerably lower. IN looked similar to OH and has this entire season as both have been hit the hardest. NE has by far been the leader in progress and conditions all season but many commented they expected better results than what was found and recent dry conditions have limited the potentials. The tour will spend the next 2 days in IL, IA and MN.
• IN Corn 161.5 -11% from LY tour & -8% from 3 year avg, USDA August 166 -12% from LY Final
• NE Corn 172.5 -4% & +3%, USDA August 186 -3%
• IN Soybeans 3X3 area 923.9 pods -30% from LY tour & -24% from 3 year avg, USDA 50 -15% from LY Final
• NE Soybeans 1210.8 pods -7% & – ½%, USDA 58 -2%
Another overnight of higher grains with corn finishing 1 higher, soybeans 4 higher but wheat steady to 3 lower. There continues to be a lack of news for wheat except for the continued missed export business. Basis is firm as flour mills look to source their needs before fall harvest gets underway.
USDA announced a private sale of 328,000 MT or 12.9 MBU of new crop corn sold to Mexico.
Heavy yet still spotty rains move through NE, KS, IA and MO today with 1-4 inches expected from KS up through MN over these next few days. The forecast has pulled back on rain chances for the Eastern Corn Belt though as dry conditions are now a concern. The latest 6 to 10 day outlook showing normal to above normal temps west with below normal in the Northern Plains and creeping into the Western Corn Belt and above normal moisture now from KS to the Great Lakes with below normal west.
September corn down into a new recent low at $3.58 ¼ last week with support next at $3.52 ½ and a gap from $3.79 to $3.85 ¼. The December contract dipped down for a new recent low yesterday at $3.68 ¼ with support next down at $3.63 ¾ and a gap from $3.88 to $3.92 ¾. September soybeans with support near $8.40 and resistance up at $8.84. The November contract with support around $8.60 and resistance up at $8.96. September KC wheat holding a lower trend with the contract low hit last week at $3.80 ¾ and resistance up around $4.20. September Chicago wheat trending lower into a new recent low at $4.56 ¼ overnight with support next down near $4.53 and resistance up at $4.80. September Soybean Meal trending lower with the contract low down at $286.9, support at $291 and resistance around $300.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700