Date: December 16th, 2020
Livestock futures finished mixed yesterday as grains were higher. Live cattle contracts continue sideways this week as feeders and lean hogs held modest gains. Cash feedlot trade still waiting to develop as showlists appear to be smaller this week. There were a few small sales reported in the North yesterday, down another $2, at $105 live and $165 dressed. Cattle on Feed report coming out this Friday with hopefully a friendly report, at least for the spring/summer 2021 outlook. The average trade estimate for cattle on feed as of December 1st is right at 100% vs. a year ago. Placements though are again expected to be lower than year ago at 91% with Marketings at 98%. Chinese Ministry of Ag and Rural Affairs stating that at the end of November 2020 the country’s hog and sow herd have recovered 90% of normal levels from dealing with African swine fever the past couple years and expect production to reach normal levels in the first half of 2021.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 12/14/2020
Total Receipts: 4,044 Last Week: 10,277 Last Year: 3,055
Compared to last week, steers under 650 lbs steady to 5.00 higher, over 650 lbs steady, heifer calves under 600 lbs steady to firm, over 600 lbs steady. Demand moderate to good, supply moderate.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 12/14/2020
Total Receipts: 10,744 Last Week: 16,925 Last Year: 9,720
Compared to last week: Feeder steers and heifers steady to 2.00 higher. Steer and heifer calves 3.00-5.00 lower than last week’s sharply higher market. Long weaned calves with multiple rounds of shots sold steady to 1.00 lower. Demand moderate.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 12/14/2020
Total Receipts: 1,730 Last Week: 4,629 Last Year: 3,024
Compared to last week: Heavy snow throughout the trade area kept receipts too few for a comparable. However 700 to 800 pound cattle had a higher undertone noted. Calves had a slightly lower undertone noted. Quality mostly attractive. Demand good.
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 12/15/2020
Total Receipts: 3,843 Last Week: 9,099 Last Year: 2,639
Compared with last Tuesday: All weights of steer calves under 700 lbs mostly steady except for 450 to 500 lbs 2.00 lower. Heifer calves under 600 lbs mostly steady, instances 5.00 higher on 450 to 500 lbs, 600 to 700 lbs 2.00 to 3.00 lower. Feeder steers over 700 lbs steady to 1.00 higher. Feeder heifers over 700 lbs 2.00 to 3.00 lower. Slaughter cows steady to 1.00 lower. Slaughter bulls steady.
Kingsville Livestock Auction – Kingsville, MO
Livestock Weighted Average Report for 12/15/2020
Total Receipts: 2,543 Last Week: 3,933 Last Year: 1,400
Compared to last week, steers sold steady to 3.00 higher and heifers sold uneven from 5.00 higher to 5.00 lower with most of the variance just depending upon buyers orders. Overall, demand was good for a quality run of calves and yearlings with several reputation consignments offered. The majority of the calves were weaned and in moderate flesh; a few groups of high quality un-weaned calves saw little to no discount.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 12/15/2020
Total Receipts: 3,186 Last Week: 3,353 Last Year: 2,216
Compared to last week, steer calves under 700 lbs. traded steady to 5.00 higher while same weight heifer calves traded 3.00-6.00 higher. Steer and heifer calves over 700 lbs. were not well tested, however undertones were lower. Demand was good on a moderate supply
Cattle slaughter from Tuesday estimated at 120,000 head, up 5,000 from last week but down 3,000 from last year. Hog slaughter from Tuesday estimated at 497,000 head, up 1,000 compared to last week and compared to a year ago.
Boxed beef cutout values continued lower on Tuesday with 174 loads sold.
Choice Cutout__208.82 -.87
Select Cutout__192.20 -.10
CME Feeder Cattle Index__136.69 +.12
CME Lean Hog Index__65.06 +.10
Pork Carcass Cutout__74.14 -2.89
IA-S.MN Wtd Avg Carcass Base__no price reported due to confidentiality
National Wtd Avg Carcass Base__53.01 -.64
December live cattle holding a lower trend since mid-August with cash convergence and nearby support from $107 to $108 and resistance around $110. The December contract is in delivery with volume getting thin and will expire at the end of the month. February live cattle also holding a lower trend with support around $110 and resistance at $114. January feeders holding a higher trend since mid-October with support around $135 and resistance at $142. February lean hogs tested the support at $63, the low from last month, then took out nearby resistance this week at $66 with the next up at $70.
Grains were higher Tuesday led by the soybeans. NOPA crush out yesterday reported 181.02 MBU soybeans processed domestically in November compared to the average pre report estimate of 180 MBU, last November’s 164.91 MBU and last month’s record 185.24 MBU. This is a new record amount for November, third highest all-time, and represents that current prices are still not high enough to ration demand. Egypt snap tender for wheat after the sharply lower day on Monday resulted in a purchase of 2 cargoes from Romania and 2 from Ukraine. Russian wheat was in the mix but shipment would be bumping right up against their announced mid Feb export tax and quota. Corn is still moving sideways as we now have 2 weeks of fairly tight range bound trading.
Overnight, grains trading both sides of unchanged but were mostly stronger with corn finishing 1 to 3 higher, soybeans 3 to 7 higher and wheat 1 to 3 higher. No daily sales announcements by USDA so far this week.
Basis levels for corn and soybeans have been mixed this past week with some domestic processors easing or weakening their basis has grains have rebounded and possibly look to test recent contract highs. The other thing to factor in is the cash flow needs as we get ready to hit the end of the year and begin a new year. There have been many times in history when basis levels back off during the last half of December through the first half of January simply because grain is moving from the producer’s hands to commercial ownership.
The U.S. 6-10 day outlook still showing normal to above normal temps for the entire country with below normal moisture for the Southwest now creeping into the Corn Belt and above normal only showing for the eastern quarter of the U.S.
March corn range bound so far this month from $4.14 ½ to $4.29 since hitting a new contract high at $4.39 ½ on November 30th. January soybeans contract high was hit November 23rd right at the $12 mark, with nearby support around $11.42. March KC wheat with resistance at $5.88 and support at $5.57. March Chicago wheat with resistance at $6.22 and support at $5.94. January Soybean Meal with resistance at $401and support at $376.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700