Date: December 2nd, 2019
Cattle futures finished lower on Friday on light volume but still managed to hold gains for the week. Cash feedlot trade was on Wednesday with trade in the South at $118 to $119 live, $2 to $3 higher than the week previous. Trade in Nebraska was reported at $118 to $120 live and $187 to $188 on a dressed basis, $2 to $4 higher. Lean hogs were able to jump triple digits higher and pull week over week changes back in the green. Weekly export sales were not very impressive but China did jump in a buy another 17,700 MT of pork for 2020.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 11/29/2019
RECEIPTS: Auctions Direct Video/Internet Total
This week: 58,600 25,900 100 84,600
Last week: 323,900 40,700 21,000 385,600
Year Ago: 289,500 49,400 43,800 382,700
Steer and heifers were lightly tested on a national basis this week with limited receipts due to the Thanksgiving holiday. Not enough receipts for an adequate market test. Areas of the Northern Plains received large snowfalls with high winds early this week with another system forecast for this weekend.
For the week, Friday November 22nd through Friday November 29th, December Live Cattle +$2.52, February +$2.35, January Feeder Cattle +$3.00, March +$3.42, December Lean Hogs +$.80, February +$.52. Boxed Beef, Choice -$.45 @ $232.12, Select -$.98 @ $210.34. Pork Carcass Cutout -$1.22 @ $81.85.
Cattle slaughter from Friday estimated at 115,000 head, up 1,000 from the week previous but down 7,000 from last year. For the holiday shortened week, 556,000 head, down 106,000 from the week previous and down 85,000 from last year. Beef production estimated at 459.5 million pounds compared to 545.8 million the week previous and 531.7 last year. Beef production up .3% compared to a year ago with cattle slaughter up 1.1%.
Hog slaughter from Friday estimated at 486,000 head, down 2,000 compared to the week previous but up 13,000 compared to a year ago. For the week, 2,343,000 head, down 415,000 compared to the week previous and down 187,000 compared to a year ago. Pork production estimated at 501.3 million pounds last week compared to 588.3 the week previous and 541.1 million last year. Pork production is up 4.5% compared to a year ago with slaughter up 3.9%.
Boxed beef cutout values steady to weak on light to moderate demand and offerings for a total of 65 loads sold.
Choice Cutout__232.12 -.12, -.45 for the week
Select Cutout__210.34 -.30, -.98 for the week
CME Feeder Index__145.11 +.40
CME Lean Hog Index__N/A, 58.35 last updated 11/27
Pork Carcass Cutout__81.85 +1.87, -1.22 for the week
IA-S.MN Wtd Avg Live Price__N/A, Wtd Avg Carcass Base__43.29 +.52
National Wtd Avg Live Price__33.18 no comparison, Wtd Avg Carcass Base__42.80 -.09
December live cattle hit a new recent high at $122.07 with resistance next up near $124 and support at $117.70. January feeders trying to break the lower trend that has been in place since peaking at $147.77 back on November 12th. Resistance first up at $144.15 with support at $140. December lean hogs holding the lower trend that has been in place since mid-April with support just above $60 and resistance up at $66.
Grains finished mixed on Friday with wheat leading the charge higher, corn with a nice recovery but the soybean complex continued under pressure. Export sales for the week ending November 21st were above expectations and friendly at 3.5 MBU of grain sorghum, 22.5 MBU of wheat, 31.8 MBU of corn and 61.1 MBU of soybeans.
For the week, Friday November 22nd through Friday November 29th, December Corn +$.02 ½, March +$.02 ¾, January Soybeans -$.20 ¼, March -$.20, December KC Wheat +$.14 ¾, March +$.13 ¾, December Chicago Wheat +$.32 ¼, March +$.23, December MPLS Wheat +$.01 ¾, March +$.07 ¾, December Soybean Meal -$8.10/T, January -$8.10/T.
Overnight, grains were mixed with corn and wheat trading both sides of unchanged and finishing 1 lower while soybeans bounced back to finish 5 higher. The soy complex is very oversold and due for a corrective bounce but it would take a 20 cent rally to break the heavy pressure and momentum lower.
China still calling for tariff rollback with this Phase 1 of the trade deal with the U.S. not giving in just yet.
December grain contracts are now in delivery and cash bids are based off March futures with no daily limits on the nearby contract and volume becoming very thin. This month’s trading activity could be very slow with a lack of fresh news. It is a new month though which means some fresh money flows. USDA will give an update on demand next Tuesday but they will not update the supply side until the January crop report. Year-end cash grain movement could impact the market but it most likely take an event to trigger a market response or some massive export sales/shipments.
This week’s weather looks fairly mild with heavy rain on the West Coast. The 6-10 day outlook showing above normal temps for the entire U.S. with above normal precipitation on both coasts and below normal centered over the Western Corn Belt.
December corn trying to break the lower trend that has been in place since mid-October with support at $3.68 then $3.62 and resistance at $3.78 then $3.81. January soybeans holding a lower trend with support next around the $8.70 area and resistance at $9.10. December KC wheat still holding a higher trend since early September with support at $4.20 and resistance up at $4.44. December Chicago wheat also trending higher with support at $5.08 and resistance up near $5.65, the highs from this past summer. December soybean meal into a new recent low at $290.60 last week with resistance up at $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