Date: March 25th, 2020
Cattle futures were limit higher for the second day in a row, expect for the soon to expire March Feeder contract. Equities were supportive with the DOW up over 2100 points or 11%. Cash feedlot trade is light so far this week at $115 to $116 live and $185 to $188 dressed, $3 to $5 higher than last week. Later this morning the Fed Cattle Exchange online auction will be held with another week of decent volume at 5,886 head compared to last week’s 4,680 head of which 1,813 head sold at $111 to $113. Beef prices were steady to higher yesterday, pork lower. There continues to be good demand for beef but primarily hamburger now after the run on all meats over this past week. I witnessed this yesterday stopping in a local grocery store where hamburger was the only item missing from the meat counter. This is concerning for beef moving forward with consumer freezer space now full and the lack of demand so long as restaurants remain pick up or delivery only.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 3/23/2020
Total Receipts: 1,795 Last Week: 1,724 Last Year: 7,087
Compared to a light test last week, steers under 700 lbs 15.00 to 25.00 higher, heifers under 700 lbs 10.00 to 15.00 higher, steers and heifers over 700 lbs not well tested last week for a good price comparison, undertone sharply higher.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 3/23/2020
Total Receipts: 1,310 Last Week: 1,208 Last Year: 7,049
Compared to last week: Feeder steers sold mostly 15.00-19.00 higher. Feeder heifers not well tested, but instances of 12.00 higher on comparable receipts. Steer and heifer calves were not well tested, but instances of 20.00-25.00 higher.
Cattle slaughter from Tuesday estimated at 123,000 head, up 2,000 from last week and up 4,000 from last year. Hog slaughter from Tuesday estimated at 498,000 head, matching last week and up 28,000 compared to a year ago.
Boxed beef cutout values lower on Choice and firm on Select on light to moderate demand and moderate offerings for a total of 135 loads sold.
Choice Cutout__256.31 -1.01
Select Cutout__245.48 +.34
CME Feeder Index__118.23 +2.08, but in question with limited data from CME the past few days
CME Lean Hog Index__63.98 +.80
Pork Carcass Cutout__82.05 -1.46
IA-S.MN Wtd Avg Carcass Base__59.76 +1.52
National Wtd Avg Carcass Base__57.41 +1.08
Equities mixed overnight with DOW mini futures trading from 800 points higher to 300 points lower, US$ & energies lower with gold sharply lower. The Senate should be voting on a $2 trillion economic relief package later today as all parties are said to have finally agreed to terms after 5 days of debate.
March feeders still have a $10 limit today with the contract expiring this Friday. All other feeder contracts at the expanded $6.75 limit and live cattle with expanded limits for the second day in row at $4.50. April live cattle have gapped and locked limit higher now for 2 days in row with the contract low down at $91.07 and resistance next around $112.60. March feeders have resistance next at $136. April feeders, like the live cattle contracts have gapped a locked limit higher the past two trading sessions with the contract low from last week down at $108.10 and resistance up at $137.30. April lean hogs contract low at $52.12 with resistance at $68.25.
Grains finished mixed but did come back from a lower start. Ethanol margins continue to provide pressure to corn. Soybean harvest moves along in South America but port disruptions and logistics are more critical at this time. It is being reported that more than 70 municipalities are enforcing anti-coronavirus measures by controlling the movement of farm produce which is limiting the supply of soybeans to crush plants. The US$ was sharply lower but grain related news was light yesterday. The Pro Farmer acreage survey was in line with current market expectations with corn acres expected to be near 94 million and soybean acres just under 84 million. USDA still on track to release the March Planting Intentions report next Tuesday. Soybean prices have come soaring back this month, nearly back to levels trading at the first of March, yet corn is still stuck in the lower end of the range. The recent demand spike for meal, possibly lower production in South America and lack of demand for corn could continue to push that soybean to corn spread wider.
Overnight, grains were steady to firm with corn finishing 2 to 3 higher, soybeans 1 to 3 higher and wheat steady to 4 higher.
USDA announced this morning a private sale of 138,000 MT or 5.4 MBU of corn for delivery to unknown destinations and 20,000 MT of soybean oil for delivery to South Korea.
Spring season hitting most areas of these next few days, heavy rain in the Eastern Corn Belt and much above normal temps in the North and Southeast. The 6-10 day outlook showing normal to above normal temps for all except in the PNW with above normal precipitation only in the PNW and the Southeast.
May corn contract low at $3.45 ¼ with support next at $3.30 and resistance up at $3.57. May soybeans into a new recent high and filling the gap from early March with support at $8.72 ½ and resistance next at $9.12. May KC wheat breaking the lower trend with support around $4.65 and resistance currently being tested around $4.94 with the next up at the highs from mid-January at $5.11 ¾. May Chicago wheat also breaking the lower trend with support at $5.40, resistance being tested at $5.68 and the mid-January high a $5.90 ¾. May soybean meal hitting resistance this week just above $336 with support down at $311.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700