Date: February 5th, 2020
Livestock futures were mixed yesterday, $1 ranges traded for live cattle futures and $2+ for feeders, now back to looking for direction after reversals higher on Monday for cattle. Chinese meat demand is still a major concern moving forward. Cash feedlot trade very light so far this week and only in the Western Corn Belt at $120 live, another $2 lower. The Fed Cattle Exchange online auction to be held later this morning has 627 head consigned compared to last week’s 477 of which none sold, all offered at $123.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 2/3/2020
Total Receipts: 7,512 Last Week: 5,007 Last Year: 8,142
Compared to last week, steer calves 2.00 to 5.00 higher, yearling steers unevenly steady to 5.00 higher, heifers under 550 lbs steady to 5.00 lower, heifers over 550 lbs steady.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 2/3/2020
Total Receipts: 6,492 Last Week: 12,616 Last Year: 11,838
Compared to last week: Feeder steers 1.00-6.00 higher. Feeder heifers and heifer calves steady to 3.00 lower. Steer calves mostly steady to 3.00 higher with instances of 8.00 higher on 450-500 lbs. Demand moderate to good, especially good for lighter feeders headed to grass pasture. Quality plain to attractive.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 2/3/2020
Total Receipts: 2,669 Last Week: 2,498 Last Year: 2,724
Compared to last week: Steer calves 4.00-5.00 higher. Feeder steers 3.00-4.00 lower. Heifers 4.00-6.00 lower. Quality plain thru attractive. Demand good. Slaughter cows mostly steady to 1.00 higher. Slaughter bulls mostly steady to 2.00 lower.
Cattle slaughter from Tuesday estimated at 122,000 head, up 5,000 from last week and up 3,000 from last year. Hog slaughter from Tuesday estimated at 496,000 head, down 2,000 compared to last week but up 22,000 compared to a year ago.
Boxed beef cutout values steady to weak on light to moderate demand and moderate offerings for a total of 97 loads sold.
Choice Cutout__210.93 -.63
Select Cutout__207.51 +.09
CME Feeder Index__141.98 -.40
CME Lean Hog Index__61.10 -.31
Pork Carcass Cutout__68.13 -1.71
IA-S.MN Wtd Avg Live Price__N/A, Wtd Avg Carcass Base__52.81 +1.36
National Wtd Avg Live Price__42.06 no comp, Wtd Avg Carcass Base__53.39 +.54
February live cattle hit a new recent low on Monday at $120.72, reversed higher and tried, yet failed to extend those gains yesterday. Resistance is at yesterday’s high, $122.72, a gap left up from $124 to $124.10 and highs from $127.50 to $127.90 hit from mid-December to mid-January. March feeders hit a new 4-month low on Monday at $133.65, also reversed higher and were able to add to those gains yesterday. There is a gap on the charts from $138.80 to $139.20 and the recent high from January 10th up at $147.75. February lean hogs with a new contract low on Monday at $54.67 and resistance the past 2 sessions near $58 with multiple gaps left on the chart from the crash lower last week.
Grains finished steady to higher, holding gains throughout the day, but also giving up sharply higher gains early on like the cattle futures. U.S. equities rebounded yesterday with gold sharply lower and crude steady to lower. South American harvest continues to progress as overall crops are in good shape. Here in the U.S. the markets really need twice as much good or bullish news to break the panic and now oversold conditions. Export inspections were very good again last week for soybeans but disappointing for the other grains as weekly export sales for corn have picked up while just average for the other grains.
Overnight, grains were higher, actually led by soybeans as they try to reverse course after the more than $.90 crash in January. Soybeans finished 6 to 7 higher, wheat 4 to 5 higher and corn just fractionally higher, equities higher overnight along with gold and crude.
Rumors and then statements by some U.S. officials were preparing the markets for a slower than expected start to the agreed upon Phase 1 deal with China. Comments centered on blaming the coronavirus outbreak for delayed sales announcements and possible logistical issues to come. China’s state run media reported the government is looking to diversify import channels and increase agricultural product imports to meet domestic demand. Stats Canada out this morning with end of December grain stocks. Most fell in line with expectations, wheat slightly higher while canola and oats stocks were lower than expected.
Seasonal weather for most the rest of this this week with heavy snow in the Rockies towards the end of the week and heavy rain for the weekend and into early next week for the Southeast. The 6-10 day outlook showing above normal temps east and below normal for the western half of the U.S. with above normal precipitation for all except the West Coast and Florida.
March corn still holding rangebound trade with support at $3.75 ¼ and resistance at $3.94. March soybeans into a new 9-month low on Monday at $8.68 ¾ with the contract low from last May down at $8.41 ½ and resistance up at $9.03. March KC wheat breaking through the higher trendline that starting in December but still showing a higher trend going back to early September with support around $4.58 and resistance up at $4.90. March Chicago wheat also holding the higher trend that started last September with support at $5.45 and resistance at $5.76 ½. March soybean meal into a new contract low Monday at $287.10 with resistance at $299.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700