Date: October 14th, 2020
Cattle futures spent most of the day in the red and triple digits lower but moved higher right at noon and finished strong for the day. Both beef and pork prices are having a hard time finding direction recently, pork doing the best holding a higher trend. Slaughter cattle weights remain higher than a year ago even though we should be near current and hog weights have been on the increase the past few weeks. Excess product continues to hit the market, very strong pork exports have helped move product but beef still needs some help. The current beef to pork price ratio at 2.2 to 1 should support beef demand improvement in the near term. Cash feedlot trade so far this week light with TX at $109 live and NE and IA at $107 to $108 live, all steady with last week. A few cattle moved in KS at $108 which is a $1 lower. Dressed sales up to $169 in the North.
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 10/13/2020
Total Receipts: 5,196 Last Week: 3,665 Last Year: 2,522
Compared with last Tuesday: Steer calves under 500 lbs 5.00 to 8.00 lower, 500 to 600 lbs 2.00 to 4.00 lower, 600 to 700 lbs mostly steady. Heifer calves steady to 1.00 higher except for 400 to 500 lbs 3.00 to 5.00 lower. Yearling feeder steers over 700 lbs steady to 2.00 higher. Yearling feeder heifers steady. Slaughter cows and bulls mostly steady. Demand moderate to good.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 10/13/2020
Total Receipts: 2,802 Last Week: 3,147 Last Year: 4,108
Compared to last week, steer calves under 700 lbs. traded 3.00-5.00 lower with spots 8.00 lower. Steers weighing over 700 lbs. traded steady to weak. Heifer calves traded unevenly steady from 2.00 lower to 2.00 higher.
Philip Livestock Auction – Philip, SD
Livestock Weighted Average Report for 10/13/2020
Total Receipts: 7,138 Last Week: 3,700 Last Year: 6,761
Compared to last week Feeder Steers 400 to 550 Steady, 550 to 600 Steady to 2.00 lower, 600 to 850 Steady to 2.00 higher, Feeder Heifers 400 to 450 Steady, 450 to 750 2.00 to 4.00 lower, 750 to 950 Steady to 2.00 higher.
Cattle slaughter from Tuesday estimated at 120,000 head, matching last week and up 1,000 from last year. Hog slaughter from Tuesday estimated at 488,000 head, up 1,000 compared to last week but down 1,000 compared to a year ago.
Boxed beef cutout values lower with 157 loads sold on Tuesday.
Choice Cutout__212.44 -2.18
Select Cutout__200.08 -.26
CME Feeder Index__140.71 -.52
CME Lean Hog Index__78.21 +.07
Pork Carcass Cutout__95.90 +1.59
IA-S.MN Wtd Avg Carcass Base__65.02 +.53
National Wtd Avg Carcass Base__63.79 -.19
October live cattle broke through the $108 support line yesterday but then reversed higher. The next support area is down around $106 with resistance up $110.30 then $111. October feeders also breaking through nearby support yesterday with the next from $134 to $130 and resistance at $144. October lean hogs expire today. The December contract has hit resistance just above $67 with support at $64 then $61.50.
Grains with a turnaround Tuesday on light news and tighter daily ranges than the past couple wild trading days. It was rumored yesterday that China was in for 3 more cargoes of U.S. soybeans for shipment in December or January. Export inspections for the week ending October 8th continue to show very strong soybeans shipments, 79.3 MBU this past week, with 59.8 MBU headed to China. Wheat inspections were also above their weekly average need at 18.9 MBU. Corn inspections continue to lag and were below expectations at 24.9 MBU.
USDA Crop Progress Highlights 10/13/20
Corn Harvest at 41%, 25% LW, 20% LY, 32% average
Soybean Harvest at 61%, 38% LW, 23% LY, 42% average
Grain Sorghum Harvest at 49%, 38% LW, 38% LY, 43% average
Winter Wheat Planted at 68%, 52% LW, 61% LY, 61% average
Winter Wheat Emergence at 41%, 24% LW, 37% LY, 35% average
Grains were fairly quiet again overnight with a mixed finish, corn 1 to 3 lower, soybeans steady to 5 higher and wheat 2 to 5 lower.
Chinese corn futures hit a new record high as crop damage has been under review from recent typhoons. Brazil soybean planting still double digits behind their average pace as recent rains have been spotty at best with forecasts calling for wider coverage.
South Korea booked 1 cargo of South American origin corn and 1 specifically from Brazil. Algeria purchased 500K+ MT of optional origin milling quality wheat. Jordan, Ethiopia, Pakistan and Thailand still seeking wheat this week. USDA announced private sales this morning of 420,000 MT or 16.5 MBU of corn sold to China and 264,000 MT or 9.7 MBU of soybeans sold to China.
U.S. weather still wide open for fall harvest, drought in the Plains continues to spread with continued windy weather. The chance for rain pops up into mid next week across the Corn Belt. The 6-10 day outlook showing below normal temps in the North sweeping down into the Southern Plains. Above normal moisture showing for the eastern half of the U.S. and creeping back in the central states with below normal in the West.
December corn hit a new recent high last week at $3.99 ¼ with resistance next up around $4.04 and support at $3.86 ½ then at $3.77. November soybeans with a new contract high last Friday at $10.79 ¾. January 2017 was the last time a spot price was at $10.80. Support is around $10.30. December KC wheat into a new recent high last week at $5.52 ¾ with support at $5.10. December Chicago wheat also a new recent high last week at $6.16 ¾. Spot Chicago Wheat has not been above $6 since 2015. Support is now being tested at $5.87.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700