Date: September 3rd, 2019
Cattle contracts reversed lower on Friday while lean hogs continue to trade choppy but still holding the lower trend. Cash feedlot trade started early last week at $108 to $110 live in the North, which was steady with the week previous, but faded as the week progressed. In the South, trade was reported at $103 live, $3 lower than the week previous. Dressed trade in the North to end the week ranged from $165 to $172, $3 to $10 lower, and $104 to $106 live, down $2 to $4. Slaughter levels are still higher than before the plant fire, but beef prices have pulled back some from recent highs.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 08/30/2019
RECEIPTS: Auctions Direct Video/Internet Total
This Week 150,400 58,600 211,800 420,800
Last Week 87,400 64,900 65,900 218,200
Year Ago 148,700 46,900 10,600 206,200
Compared to last week, steers and heifers calves sold mostly steady to 5.00 higher, yearlings steady to 3.00 lower. With the CME cattle boards displaying a gloomy outlook the last quarter, demand for big yearlings off grass was good at the few locations that had several load lots on hand.
For the week, Friday August 23rd through Friday August 30th, August Live Cattle +$.37, October -$1.15, December -$.62, August Feeder Cattle +$1.40, September -$.85, October -$1.72, October Lean Hogs +$4.22, December +$4.60.
Cattle slaughter from Friday estimated at 115,000 head, matching the week previous but down 4,000 from last year. For the week, 644,000 head, down 10,000 from the week previous and down 1,000 compared to a year ago. Beef production is estimated at 521.7 million pounds compared to 528.7 million the week previous and 527.8 million last year. Year to date beef production is up .3% from last year while cattle slaughter is up 1.2%
Hog slaughter from Friday estimated at 473,000 head, down 3,000 compared to week previous but up 18,000 compared to a year ago. For the week, 2,461,000 head, down 67,000 from the week previous and down 3,000 from last year. Pork production for the week estimated at 511.5 million pounds compared to 525.8 million last week and 510.2 million last year. Year to date pork production is up 3.6% from last year with slaughter up 3.0%.
Boxed beef cutout values weak on light to moderate demand and light offerings for a total of 73 loads sold.
Choice Cutout__231.77 -.42, -5.75 for the week
Select Cutout__212.27 -.51, -.99 for the week
CME Feeder Index__138.55 -.14 from 8/29
CME Lean Hog Index__71.24 -1.39 from 8/28
Pork Carcass Cutout__72.31 +.75, -7.34 for the week
IA-S.MN Wtd Avg Live Price__N/A, Wtd Avg Carcass Base__56.22 -1.58
National Wtd Avg Live Price__44.39 -1.12, Wtd Avg Carcass Base__55.78 -2.14
October live cattle still has a gap from $101.67 to $103.75 then another from there up to $106.42 with support right around $98. September feeders closed one of the gaps but not the other which remains from $136.80 up to $138.07 with support at $132. October lean hogs still holding a lower trend with the recent low at $59.30 with resistance up near $66.
Over in the grains, it was a mixed trading week with corn hanging around unchanged, soybeans with a small rebound and wheat under pressure, especially to end the week. Friday marked first notice day for September grain contracts with no limits from now until expiration. The delivery process has not been tested too often in the grains, but when it is, major ramifications typically come from a move. Cargill ended up delivering low pro HRW on their 440 registered certificates in St Louis while there were 1,000 new registrations in KC. Feed wheat is the major pull right with PNW paying +$.30 over 11.5 HRW. Enumerators have checked corn and soybeans and corn fields for the upcoming USDA September crop report to be released on the 12th. The markets will continue to trade weather and trade as we come out of the holiday weekend.
For the week, Friday August 23rd through Friday August 30th, September Corn -$.01 ¾, December +$.02, September Soybeans +$.13 ¾, November +$.12 ½, September KC Wheat -$.13 ¼, December -$.07 ½, September Chicago Wheat -$.24, December -$.15 ¼, September MPLS Wheat -$.22 ¼, December -$.15 ¼, September Soybean Meal -$.60/T, December -$.10/T.
Overnight, grain markets were under pressure coming off the 3-day holiday weekend. Corn finished 2 lower, soybeans 4 to 5 lower and wheat 1 to 4 lower.
Export inspections are due out later this morning, crop progress and conditions later this afternoon. Fall crop field data collection should be complete now ahead of the USDA crop report to be released next Thursday. Any mature samples are then sent into regional labs for dry down and weighing. This will be the first objective yield survey by USDA for the fall crops this crop year as the August report only used producer survey and satellite data for their yield estimate. Harvested acreage could be adjusted as well with such an immature corn crop.
On Monday, the EU Commission reduced their corn production estimate by 1 MMT to 68.5 MMT while raising their soft wheat production estimate from 141.3 MMT to 142.7 MMT. USDA in August had 64.8 MMT estimate for corn and total wheat production at 150 MMT.
This week’s forecast showing ½ to 1 inch rains across the Corn Belt. The latest 6 to 10 day outlook showing above normal temps centered over the Southern Plains and covering most major growing areas with below normal on the West Coast and Northeast and below normal moisture for the Southeast with above normal moisture in the Northern Plains and parts of the Corn Belt.
December corn down into a new recent low at $3.64 ¼ last week with the contract low down at $3.63 ¾, resistance up at $3.81 then a gap from $3.88 to $3.92 ¾. November soybeans down to $8.52 ½ last week with resistance up at $8.82 then up near $9. December KC wheat down to a contract low at $3.93 ¾ with resistance up around $4.10. December Chicago wheat still holding a lower trend into a new recent low at $4.56 ½ and resistance up around $4.80. October Soybean Meal trending lower with the contract low down at $288.70, a new recent low at $290.50 and resistance at $295 then $302.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700