Date: October 5th, 2020
Cattle futures finished another week under pressure and for the second week in a row cash feedlot trade moved higher. Live trade reported in all areas at $107 to $108, $2 to $3 higher than the week previous and dressed trade at mostly $168, $3 higher. Lean hog futures were mixed on Friday and for the week. The nearby October contract continues to hit new highs now testing the $75 resistance area. Beef and pork exports have been good but by no means exceptional. Confirmed cases of African swine fever in Germany now up to 46 in wild boars through Friday with the area expanding.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING Friday October 02, 2020
RECEIPTS: Auctions Direct Video/Internet Total
This Week: 207,200 39,700 4,500 251,400
Last Week: 195,500 29,700 42,300 267,500
Year Ago: 192,700 60,600 4,300 257,600
Compared to last week, steers and heifers sold uneven; 2.00 lower to 2.00 higher. Demand remains good for yearling cattle with light to moderate demand for fresh calves. This time of year, true yearlings are in very short supply and buyers are willing to pay handsome prices for this type of cattle. Large supplies of calves are on the horizon, even though not many come direct, (video’s and auctions bulk of them) buyer are still seeking these calves to make yearlings or push hard to April fat cattle market for the big front-end kind. Bawling and unweaned calves continue to see discounts and are much less desirable to buyers as typical for this time of year. Early fall temperature swings make these cattle very high health risks which will remain the case until a hard frost comes and the populations in the hospital sick pens will drop. Buyers are quite willing to pay premiums for cattle if producers invest time in them and provide a documented health program.
For the week, Friday September 25th through Friday October 2nd, October Live Cattle +$.60 December -$.30, October Feeder Cattle -$.42, November -$.27, October Lean Hogs +$2.75, December -$1.92. Boxed Beef, Choice -$.46 @ $218.88, Select +$.63 @ $207.61. Pork Carcass Cutout +$.83 @ $92.15.
Cattle slaughter from Friday estimated at 117,000 head, up 5,000 from the week previous and up 7,000 from last year. Saturday’s kill was estimated at 70,000 head bringing week to date up to 665,000 head, up 14,000 from the week previous and up 20,000 from last year. Beef production estimated at 558.1 million pounds compared to 546.6 million the week previous and 528.1 million pounds last year. Year to date beef production is -1.5% compared to last year with cattle slaughter -4.1%.
Hog slaughter from Friday estimated at 464,000 head, up 2,000 from the week previous but down 18,000 compared to a year ago. Saturday’s kill was estimated at 213,000 bringing the week to date up to 2,603,000 head, up 2,000 compared to the week previous but down 57,000 compared to a year ago. Pork production last week estimated at 549.2 million pounds compared to 547.1 million the week previous and 560.9 million pounds a year ago. Year to date pork production is +1.8% compared to last year with hog slaughter +1.0%.
Boxed beef cutout values steady to slightly lower with 121 loads sold on Friday.
Choice Cutout__218.88 -.10
Select Cutout__207.61 -.01
CME Feeder Index__142.96 +.58
CME Lean Hog Index__76.81 +.07
Pork Carcass Cutout__92.15 -3.50
IA-S.MN Wtd Avg Carcass Base__63.16 -2.11
National Wtd Avg Carcass Base__63.52 -.89
October live cattle holding a higher trend over the past month and the long term higher trend holding since early April. Resistance is up at $111 which is the recent high from August with support at $107. October feeders choppy to sideways, still a higher trend since April with resistance at $144 then around $150 and support at $137.50. October lean hogs again hitting a new recent high at $75.42, testing resistance from January with the next up around $77 and support at $64.
Grains were mixed Friday after the sharp gains midweek from the friendly quarterly stocks report. Outside markets were under pressure as the announcement that President Trump was confirmed positive COVID. Soybean sales announced to both China and for unknown destinations Friday was a positive surprise for the markets as China is still on holiday. US weather remains wide open for fall harvest which should provide some pressure on the markets. South America though is still dry with early planting behind the average pace.
For the week, Friday September 25th through Friday October 2nd, December Corn +$.14 ½, March +$.16, November Soybeans +$.18 ¼, January +$.18 ½, December KC Wheat +$.34 ¼, March +$.33 ¼, December Chicago Wheat +$.29, March +$.28, December MPLS Wheat +$.02, March +$.02 ¼, October Soybean Meal +$12.50/T, December +$13.30/T.
Grains were mixed overnight. Corn finished 1 lower to ½ higher, soybeans 1 higher and wheat 5 to 10 higher as limited rainfall is expected of Russian wheat areas and world values continue to increase. Harvest pressure will continue on the fall crops which will need additional bullish fundamental news from continued export sales or a friendly crop report this Friday to keep pushing into new highs. Brazil’s rain chances also improved for later this week.
USDA announced a private sale this morning of 160,020 MT or 6.3 MBU of corn sold to Mexico.
Weather this week remains wide open for fall harvest. There were some reports of frost across IL this morning. Heavy rains expected later this week in the Southeast. The 6-10 day outlook showing above normal temps for all except the PNW with below normal moisture in the Southern Plains and above normal in the PNW and Southeast.
December corn hit a new recent high last week at $3.85 ½ which is a test of resistance from this past March. Nearby support is at $3.77 then $3.70. November soybeans new contract high on September 18th at $10.46 ¾ with support at $10.11 then $9.86. December KC wheat into a new recent high overnight at $5.24 ½ with resistance from there up to $5.28 and support at $4.93. December Chicago wheat also a new recent high overnight at $5.87 ¾ with resistance next up around $6 and support at $5.60.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700