Date: January 13th, 2021
Hello January USDA Reports! Corn limit higher, all grains into new highs, cattle triple digits lower as feed costs continue to soar. Feeders of course hit the hardest yesterday as the grains continue to rally. Nearby live cattle futures were lower but some optimism holding August and beyond near $1 higher. Cash feedlot trade starting out disappointing with light trade in the Western Corn Belt at $109 to $111 live & $173 to $174 dressed which is steady to $3 lower from last week. Some minor changes on the 2021 supply and demand side for the meats with beef production down 70 million pounds, beef exports though up 10 million, pork production down 55 million pounds, pork exports down 175 million and total poultry production down 213 million pounds.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 1/11/2021
Total Receipts: 7,392 Last Report: 11,730 Last Year: 6,263
Compared to last week, steers and heifers steady to 2.00 lower, except under 500 lbs., steady to firm. Supply and demand was moderate.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 1/11/2021
Total Receipts: 10,752 Last Report: 12,154 Last Year: 11,325
Compared to last week: Feeder steers and heifers steady to 2.00 higher, except 600-700 lb steers 4.00-6.00 higher. Steer calves steady to 4.00 higher, most advance on 5 weights. Heifer calves closing steady to 2.00 lower. Demand moderate to good. Quality average to attractive
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 1/12/2021
Total Receipts: 7,813 Last Report: 4,212 Last Year: 7,434
Compared with last Tuesday: Steer calves under 500 lbs steady instances 9.00 higher on 400 to 450 lbs, 500 to 600 lbs 5.00 to 8.00 lower, 600 to 700 lbs 2.00 to 4.00 lower, 700 to 800 lbs 3.00 to 5.00 lower, over 800 lbs 1.00 to 2.00 lower. Heifer calves under 400 lbs 3.00 to 5.00 higher, 400 to 700 lbs 2.00 to 5.00 lower except for 500 to 600 lbs 5.00 to 8.00 lower, over 700 lbs mostly steady. Slaughter cows and bulls steady.
Cattle slaughter from Tuesday estimated at 119,000 head, up 1,000 from last week but down 5,000 from last year. Hog slaughter from Tuesday estimated at 498,000 head, up 9,000 compared to a week ago but down 2,000 compared to a year ago.
Boxed beef cutout values on Tuesday higher with 172 loads sold.
Choice Cutout__209.14 +1.45
Select Cutout__198.09 +2.35
CME Feeder Cattle Index__136.23 +.07
CME Lean Hog Index__64.49 +.58
Pork Carcass Cutout__79.19 -.14
IA-S.MN Wtd Avg Carcass Base__54.63
National Wtd Avg Carcass Base__55.00
February live cattle still holding a higher trend since late October with nearby support at $113.00 taken out yesterday, the next at $111.35 and resistance at $114.40 then at $116.00. January feeders holding the lower trend now for 3 weeks, dipping below the December and November lows with support next around $130 then the low from October down at $124.25 with resistance at $138. February lean hogs breaking higher last week to test the resistance at $72 then pull back into the range bound trading pattern that has held for the past couple months with support around $67.
Over in the grains, again corn, the front 3 months, locking limit higher with expanded limits today at $.40. The leading story has been demand rationing for soybeans but with the updated estimates and South American corn crop also getting smaller, demand rationing for corn needs to be in the discussion as well. Acreage here in the U.S. will be interesting this spring as well with winter wheat acres up 1.5 million to 32 million acres planted and the need for additional corn, soybean and grain sorghum acres based off current demand projections.
Just how bullish were the crop reports…
2020 U.S. Corn yield down 3.8 BPA, production down 325 MBU, ending stocks down 150 MBU to 1.552 BBU, tightest stocks to use ratio at 10.6% since the 2013/14 crop year, world stocks down 5.13 MMT, Argentina production down 1.5 MMT, Brazil down 1 MMT to 109 MMT, Brazil’s CONAB down to 102.3 MMT
2020 U.S. Soybean yield down .5 BPA, production down 35 MBU, ending stocks down 35 MBU to 140 MBU, also tightest stocks to use ratio at 3.1% since the 2013/14 crop year, World Soybean ending stocks down 1.33 MMT, Argentina down 2 MMT, Brazil left unchanged, China increased 2.1 MMT
U.S. Wheat ending stocks down 26 MBU to 836 MBU, 2021 Winter Wheat acreage near to top end of the trade estimates at 32 million acres, World Wheat ending stocks down 3.31 MMT, more than 2 MMT under average estimate
Overnight, the rally continues, led by corn, with all the grains into new contract highs again. Corn finished the overnight 2 to 19 higher, soybeans steady to 4 higher and wheat steady to 6 higher.
South Korea purchased 66,000 MT or 2.6 MBU of Brazilian corn and 50,000 MT or 1.8 MBU of Australian milling quality wheat. Russia now looking at imposing an export tax on corn and barley beginning February 1. USDA announced a private sale of 396,300 MT or 14.6 MBU old crop soybeans and 68,000 MT or 2.5 MBU new crop soybeans for delivery to unknown destinations.
Weather continues to be fairly mild this week. The 6-10 day outlook showing above normal temps for the West Coast and the northeast quarter of the U.S., below normal in Southwest, with below normal moisture on the West Coast and above normal in the Northern Plains.
March corn with a new contract high overnight at $5.41 ½, taking out the 2014 spot high during yesterday’s run, with the next a crazy to think about at this time at $7.30 mark from July 2013. March soybeans a new contract high overnight at $14.36 ½, also taking out the July 2014 highs with the next spot high up at $15.11 ¾ from June 2014 then $15.36 ¾ from May 2014. March KC wheat, a new high overnight at $6.39 ½, with support at $5.90. March Chicago wheat, a new high overnight at $6.80 ¾ with support at $6.30. March soybean meal a new high overnight at $471.40, resistance next up around $500.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700