Date: November 30th, 2020
Livestock futures backed off a bit on Friday but still finished strong week over week. Cash feedlot trade in the Southern Plains, compared to last week, mostly reported live purchases traded $1 higher at $111. In Nebraska, when compared to last week, live purchases traded steady to $1 higher from $110 to $111 and dressed purchases traded $2 higher at $174. Beef weekly export sales were a net reduction due to cancellations from South Korea, Mexico, Hong Kong and Taiwan. Pork sales were friendly and actual shipments were bullish.
NATIONAL FEEDER & STOCKER SUMMARY – WEEK ENDING 11/27/2020
RECEIPTS: Auctions Direct Video/Internet Total
This Week: 112,300 35,300 1,600 149,200
This Week: 321,900 45,400 9,800 377,100
Year Ago: 58,600 25,900 100 84,600
Steers and heifers were lightly tested on a national basis this week due to the Thanksgiving Day holiday week and reduced receipts. Areas of the Northern Plains did receive some moisture this week and is a welcome sight to the parched fields that ranchers have been looking at this summer and fall. The rancher is no doubt receiving less income for the same steer or heifer they are feeding this year. With the advance of feedstuffs through harvest this year (typically feedstuffs get cheaper), this increases cost of gains. Profits will no doubt be slimmer with those two pieces of the puzzle. In addition, current Choice boxed beef prices are near 11.00 higher than a year ago; leading one to believe that packer margins are much more than they were a year ago.
For the week, Friday November 20th through Friday November 27th, December Live Cattle +$2.52, February +$2.60, January Feeder Cattle +$5.22, March +$4.62, December Lean Hogs + $1.75, February +$1.90. Boxed Beef, Choice +$4.50 @ $242.85, Select +$5.70 @ $220.68. Pork Carcass Cutout +$1.79 @ $79.96.
Cattle slaughter from Friday estimated at 115,000 head, matching the week previous and up 2,000 from last year. Saturday’s kill estimated at 88,000 head, bringing the week to date to 564,000 head, down 101,000 from the week previous but up 9,000 from last year. Beef production last week estimated at 473.9 million pounds compared to 559.1 million the week previous and 463.8 million last year.
Hog slaughter from Friday estimated at 480,000 head, down 5,000 compared to week previous but matching a year ago. Saturday’s kill is estimated at 380,000 bringing week to date up to 2,350,000 head, down 361,000 compared to the week previous but up 28,000 compared to a year ago.
Boxed beef cutout values Friday, sharply lower on Choice and lower on Select on light demand with only 51 loads sold.
Choice Cutout__242.85 -2.21
Select Cutout__220.68 -.22
Pork Carcass Cutout__79.96 +1.61
IA-S.MN Wtd Avg Carcass Base__56.50 +.31
National Wtd Avg Carcass Base__56.73 -.66
December live cattle broke through nearby resistance, the major moving averages all converging right around $110 which is now support. The November high will be the next upside target at $112.70. January feeders also back above all major moving averages with resistance at $141.50, the November high, and support around $138 then $135. December lean hogs holding a lower trend since October with support tested last week at $63.50 then down around $62 and resistance up at $67.60.
Grains finished strong on Friday and held gains for the week. Weekly export sales were above expectations for both wheat and corn at 29.2 MBU & 65.6 MBU respectively. Soybeans were a new marketing year low but still 28.2 MBU. The IGC lowered its world corn production while doubling the import estimate for China. Private estimates for Russian grain production continued to be lowered. Rains were present in dry areas of Brazil to end the week as forecasts were also improved heading into this week.
For the week, Friday November 20th through Friday November 27th, December Corn +$.02 ¼, March +$.05 ½, January Soybeans +$.10 ¾, March +$.11 ½, December KC Wheat +$.11 ¼, March +$.06, December Chicago Wheat +$.03 ¼, March +$.06 ½, December MPLS Wheat +$.06 ¾, March +$.09, December Soybean Meal +$3.80/T, January +$3.80/T.
Overnight markets were mixed to lower with grains starting higher but fading as the night progressed. Corn finished the overnight ½ to 2 lower, soybeans 7 to 11 lower and wheat 3 to 10 lower. Outside markets are weaker as well with equities and energies both lower this morning.
Russia’s Ag ministry stated they are considering increasing the planned mid-February through end of June grain export quota to 17.5 MMT up from the previous 15.0 MMT.
Chinese customs reported that starting on November 30th, Mexico has been approved for grain sorghum exports to China. USDA data shows that last year’s Mexican crop was about half of the U.S. and Mexico is the second largest importer of U.S. grain sorghum behind China.
Australia’s Ag agency noted good precipitation has pushed up the country’s wheat production prospects to 31.17 MMT compared to 28.91 MMT in September.
USDA announced a total of 344,000 MT or 13.5 MBU of corn sold for unknown destinations.
Heavy rains and much below normal temps still in the nearby forecast for the Southeast. A winter storm in the forecast for the Southern Plains midweek. The 6-10 day outlook showing above normal temps centered over the Northern Plains stretching to the West Coast with below normal temps in the Southeast and below normal moisture for all expect in New England.
December corn with a new contract high overnight at $4.30 1/2. Nearby resistance from the continuous weekly chart next at $4.32 then around $4.50 with support at $4.17 then $4.09. January soybeans contract high last week right at the $12 mark, overnight high up to $11.99. The last time a spot contract was above $12 was back in June 2016 at $12.08 ½. Nearby support at $11.38. December KC wheat chopping sideways the past couple months with support at $5.42 and resistance at $5.70. December Chicago has held a higher trend since late June but a lower trend since mid-October with support at $5.80 and resistance at $6.16 ½.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700