Date: March 10th, 2020
At the time livestock futures closed, the Dow Jones Industrial Average was down over 1,600 points, trading over 2,100 points lower and finishing 2,015 lower, with the NASDAQ Composite down 625 and the S&P 500 Index down 226. The stock market triggered 2 circuit breaker pauses yesterday shortly after the open. Both live and feeder cattle contracts opened their respective limits lower, $3 and $4.50, yet did come off those limits during the trading session with only the August live contract settling limit lower but every feeder cattle contract. Lean hogs also touched $3 limit lower and finished just above those marks. Cash feedlot trade reported in Nebraska and Western Corn Belt on a few thousand head down another $3 to $5 at $110 live and $175 dressed.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 3/9/2020
Total Receipts: 5,627 Last Week: 3,343 Last Year: 8,645
Compared to last week, steer and heifer calves 3.00 to 8.00 lower, yearling steers 3.00 to 6.00 lower, except 800 weights steers 8.00 to 10.00 lower, with limited comparisons last week, yearling heifers 2.00 to 5.00 lower. Demand and supply moderate.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 3/9/2020
Total Receipts: 7,500 Last Week: 5,879 Last Year: 14,741
Compared to last week: Feeder steers 5.00-10.00 lower. Feeder heifers 7.00-11.00 lower. Steer calves 14.00-17.00 lower. Heifer calves 500- 600 lbs. 3.00-6.00 lower, lighter weights 9.00-10.00 lower. Demand light. Quality plain to average.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 3/9/2020
Total Receipts: 2,253 Last Week: 1,782 Last Year: 3,219
Compared to last week: Feeder Steers and Heifers 7.00-9.00 lower. Steer & Heifer calves have a sharply lower undertone.
Cattle slaughter from Monday estimated at 122,000 head, up 1,000 from last week and up 2,000 from last year. Hog slaughter from Monday estimated at 497,000 head, up 2,000 compared to last week and up 23,000 compared to a year ago.
Boxed beef cutout values generally steady on light demand and offerings for a total of 92 loads sold.
Choice Cutout__207.36 -.11
Select Cutout__202.32 -.25
CME Feeder Index__134.82 +.95
CME Lean Hog Index__57.09 +.11
Pork Carcass Cutout__67.95 +1.09
IA-S.MN Wtd Avg Carcass Base__51.67 +.45
National Wtd Avg Carcass Base__51.30 +.40
A little recovery mode overnight with Dow mini futures up over 1,100 points earlier this morning, fading to now only up …, crude oil up $2+, gold down $11+ and the US$ stronger so far today. Feeders do have expanded limits today but fats still limited to a $3 move.
April live cattle gaped lower into a new contract low at $102.75 yesterday with support from the continuous weekly chart next at $100 and resistance up at $112.70. March feeders also gaping lower with the contract low down at $126.05, support next down near $120 and resistance up at $136. April lean hogs chopping sideways since early February with the contract low the next line of support down at $61 and resistance up at $68.25.
Grains traded mostly lower yesterday with soybeans the leader, corn holding minor losses and wheat mixed. The US$ was sharply lower, down over 5 points since peaking in mid-February and down to a level not seen since October 2018 along with crude oil dipping below $28 for the first time since early 2016.
Export inspections for the week ending March 5th were under expectations and below the weekly average needed which was not friendly news mid-morning. Corn inspections totaled 32.7 MBU with Mexico taking 12.4 MBU and Japan 7.9 MBU. Soybean inspections totaled 21.0 MBU with China taking 5.1 MBU and Japan at 4.5 MBU. Wheat shipments totaled 15.3 MBU with 10.2 MBU going to Southeast Asia. Grain sorghum totaled 2.3 MBU with 1.8 MBU going to Ethiopia. Year to date, corn inspections are down 44% from last year, soybeans up only 1% now, wheat up 9% and grain sorghum up 54%.
KS winter wheat conditions improved by 4% to 47% good to excellent and poor to very poor down 2% to 18%. TX crop progress report showed corn 28% planted compared to 12% last week, 11% last year and 10% 5-year average. Grain sorghum planted at 32% compared to 12% last week, 9% last year and 13% 5-year average. Winter wheat headed at 25% up 1% from last week and only 6% last year and 1% 5-year average. Conditions though down 10% to 26% G/E and P/VP up 11% to 34%.
Overnight, grains rebounded along with the outside markets with corn finishing 3 higher, soybeans 8 higher and wheat 3 to 5 higher.
Brazil’s CONAB updated production estimates this morning. Total corn production down slightly from a month ago to 100.08 MMT. First crop estimated slightly lower at 25.56 MMT and second crop slightly higher at 73.37 MMT. Soybean production increased 1 MMT to 124.2 with some private estimates still north of 125 MMT.
USDA will update supply and demand data later this morning at 11 AM CST. The following is the average pre-report trade estimates…
US 19/20 Corn ending stockpiles at 1.888 BBU vs. February’s 1.892 BBU
US 19/20 Soybean ending stockpiles at 426 MBU vs. February’s 425 MBU
US 19/20 Wheat ending stockpiles at 945 MBU vs. February’s 940 MBU
World 19/20 corn ending stockpiles at 297.3 MMT vs. 296.8 MMT
World 19/20 Soybean ending stockpiles at 99.3 MMT vs. 98.9 MMT
World 19/20 Wheat ending stockpiles at 288.5 MMT vs. 288.0 MMT
2019/2020 Argentina Soybean production at 53.8 MMT, up from the 53.0 MMT
2019/2020 Brazil soybean production is forecast at 125.0 MMT, unchanged
2019/2020 Argentina corn production at 50.5 MMT, up from the 50.0 MMT
2019/2020 Brazil corn production is forecast at 101.0 MMT, unchanged
USDA announced for the second day in a row a private sale this morning of 123,000 MT or 4.5 MBU of soybeans for unknown destinations.
Heavy rains remain in the forecast for the Southeast this week then snow in the forecast moving in from the West heading into the weekend. The 6-10 day outlook showing above normal temps south and east and below normal north and west with above normal precipitation across most of the U.S., below normal in the PNW, New England and Florida.
May corn gaping lower but holding off from taking out the contract low hit on February 28th at $3.65 ¾ with support next at $3.61 ¾ then $3.57 and resistance up at $3.87. May soybeans into a new 10-month low at $8.67 with the contract low down at $8.54 and resistance up around the $9.00 mark. May KC wheat holding a lower trend since mid-January with support next around $4.30 and resistance at $4.65. May Chicago also holding a lower trend, tested support near $5.06 on Monday with resistance at $5.40. May soybean meal unable to break the long term lower trend last week with support at $300 and resistance at $311.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Matt Burgener
www.loewenassociates.com pete@loewenassociates.com matt@loewenassociates.com
866-341-6700