Date: June 1st, 2020
Negotiated cash feedlot still somewhat sparse and spread out throughout the week. KS and TX trade ranged from $115 to $120 live but the bulk of the trade was at $115 which is $5 lower than the week previous. Trade in NE was steady from $112 to $120 live and $190 dressed. New unemployment claims last week totaled 2.1 million Americans bringing the total from mid-March up to 40.8 million. Those collecting for more than 2 weeks though was down 3.86 million to now a total of 21.05 million Americans.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 05/29/2020
RECEIPTS: Auctions Direct Video/Internet Total
This Week: 138,200 42,000 57,600 237,800
Last Week: 204,800 51,200 1,800 257,800
Year Ago: 91,200 24,400 18,100 131,700
Compared to last week, steers and heifers sold steady to 5.00 higher. Demand was good again this week as auctions were only held at limited places this week due to the Memorial Day holiday on Monday.
For the week, Friday May 22nd through Friday May 29th, June Live Cattle +$2.02, August +$2.27, August Feeder Cattle +$6.55, September +$5.60, June Lean Hogs -$1.92, July +$1.12. Boxed Beef, Choice -$33.40 @ $363.34, Select -$34.11 @ $340.07. Pork Carcass Cutout -$8.55 @ $88.20.
Cattle slaughter from Friday estimated at 111,000 head, up 9,000 from the week previous but down 13,000 from last year. For the week, 524,000 head, down 31,000 from the week previous and down 64,000 from last year. Beef production last week estimated at 428.6 million pounds compared to 451.4 million the week previous and 463.8 million last year. Year to date slaughter is now down 6.9% compared to last year with beef production down 4.7%.
Hog slaughter from Friday estimated at 414,000 head, up 34,000 compared to the week previous but down 59,000 compared to a year ago. For the week, 1,966,000 head, down 171,000 compared to the week previous and down 165,000 compared to a year ago. Pork production last week estimated at 430.6 million pounds compared to 466.0 million the week previous and 458.7 million pounds last year. Hog slaughter is now down 1.3% compared to a year ago with pork production down .6%.
Boxed beef cutout values again sharply lower on Friday with 115 loads sold.
Choice Cutout__363.34 -6.22
Select Cutout__340.07 -4.02
CME Feeder Index__129.36 +2.34
CME Lean Hog Index__61.25 -1.70
Pork Carcass Cutout__88.20 -1.26
IA-S.MN Wtd Avg Carcass Base__37.11 -.63
National Wtd Avg Carcass Base__36.92 -.42
Outside markets a little defensive this morning after reports that China is now telling state firms to cease buying U.S. farm goods which include soybeans and pork. June live cattle up to a new recent high last week at $101.60 now above all major moving averages with resistance next around $106 and nearby support at $96.70. August feeders holding a higher trend with support at $128.30 and resistance at $138.80. June lean hogs holding a lower trend now for a month with support next around $55 and resistance up at $62.
Grains finished mixed on Friday but higher for the week. Weather has created some issues in the North and mid-South so far this spring but for the most part as been a non-event. The markets are most certainly controlled by or act as “government markets” stemming back to when the trade war began with China. Tensions with China have been escalating again but President Trump did not announce additional tariffs on China, which would be very bearish for the grain complex, simply that Hong Kong will now be treated just like China. Funds remain very bearish to the corn market as they are net short over 276k contracts with the record from 2008 at 330k contracts. Crude oil prices continue to climb higher as demand is picking back up domestically and both OPEC and Russia are in discussions to extend the oil production cuts another one to two months. Wheat futures may have found a seasonal bottom as we proceed into HRW harvest to finally be able to completing assess the freeze damage issues along with continued weather pressure in Europe and Russia. Russian wheat prices are seen as unchanged compared to a week ago.
For the week, Friday May 22nd through Friday May 29th, July Corn +$.07 ¾, December +$.06, July Soybeans +$.07 ½, November +$.07 ¼, July KC Wheat +$.26, July Chicago Wheat +$.12, July MPLS Wheat +$.12, July Soybean Meal -$.90/T.
Overnight, grains flipped from early small gains to lower as the morning progressed. Corn finished the overnight 4 to 6 lower, soybeans 2 to 5 lower and wheat 6 to 10 lower.
The expectations for this afternoon’s crop progress report are to see 95% of the U.S. corn crop planted and possibly a couple percentage point improvement in the already 70% rated good excellent conditions. U.S. soybeans are expected to be near 80% planted with the first conditions report to be near 70% rated good to excellent.
Rains over the weekend were scattered in the WCB and the heaviest in the Gulf, PNW and East Coast. Flooding still an issue in the Dakotas, Northern MO and along the IL River. Much above normal temps dominate the Northern Plains over these next few days. The 6-10 day outlook showing above normal temps centered on the WCB and stretching from the Rockies to the East Coast with below normal in the PNW. Above normal precipitation in the forecast for the PNW, Northern Border States and Southeast with below normal in the Southern Plains.
July corn still holding steady to higher over this past month and a half. The contract low is down at $3.09, nearby support around $3.16 with resistance up at $3.30. July soybeans still in a choppy 30 cent range yet showing a slow uptrend like corn since hitting its contract low at $8.18 ½ back on April 21st. Nearby support around $8.30 and resistance up around $8.60. July KC wheat finding support around $4.40 with resistance at $4.90. July Chicago wheat held support around $4.94 which matched the lows from mid-March with resistance up around $5.30.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700