Date: February 24th, 2021
Livestock futures mixed yesterday with cattle under pressure and hogs higher. Showlists smaller this week as last week’s slaughter plant shutdowns may not back up fed cattle or hurt the market has badly as initially thought. Light trade so far this week at $114 live in TX and $181 dressed in the North, steady with the past couple weeks. It does feel like though once we can get some momentum and buying enthusiasm there comes a setback for cattle. Feeders still holding their recent trading range but live cattle broke through nearby support yesterday.
USDA January Cold Storage Report
Total red meat supplies in freezers were up 3% from the previous month but down 12% from last year. Total pounds of beef in freezers were down 3% from the previous month but up 6% from last year. Frozen pork supplies were up 11% from the previous month but down 26% from last year. Total frozen poultry supplies were up 3% from the previous month but down 11% from a year ago.
NATIONAL FEEDER & STOCKER CATTLE SUMMARY – WEEK ENDING 02/20/2021
RECEIPTS: Auctions Direct Video/Internet Total
THIS WEEK: 77,600 18,300 1,900 97,800
LAST WEEK: 130,500 41,100 36,700 208,300
YEAR AGO: 240,100 36,100 38,900 315,100
Compared to last week, steers and heifers at North Central auctions were 1.00 to 5.00 higher. In Oklahoma and Missouri (two large cow-calf states), only one feeder cattle auction per state was reported with less than 900 head combined between the two. For perspective a year ago this week, Oklahoma and Missouri each contributed 35K plus to this report. Replacement cattle continue to be in demand this week as ranchers look for their next heifers that will make cows for a long time.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 2/22/2021
Total Receipts: 6,150 Last Report 2/8/21: 2,928 Last Year: 8,701
Compared to the sale 2 weeks ago, (no sale last week due to heavy snow and sub-zero temperatures), steers under 600 lbs. traded 9.00-15.00 higher, with steers over 600 lbs. trading 3.00-4.00 higher. Demand was very good for large lots of quality cattle. A lot of 96 head of 512 lb. steers traded at 192.00. Heifers under 600 lbs. traded 5.00-12.00 higher, with weights over 600 lbs. trading up to 3.00 higher.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 2/22/2021
Total Receipts: 2,723 Last Year: 12,805
Compared to the last sale two weeks ago: Feeder steers and heifers lightly tested and few sales steady to 2.00 higher. Demand moderate to good for feeder cattle following a week of no sales due to weather. Steer and heifer calves steady in a light test. Demand good for calves.
Sioux Falls Regional Cattle Auction – Worthing, SD
Livestock Weighted Average Report for 2/22/2021
Total Receipts: 5,817 Last Week: 1,090 Last Year: 5,492
Compared to last week: Feeder steers and heifers sold with definite higher undertones. Due to intense frigid temperatures last week there were several cancellations that rolled over into this week making receipts much larger this week. Demand for this very attractive offering of cattle was very good. Farmer buyers were very active this week. Flesh conditions were good to heavy.
Philip Livestock Auction – Philip, SD
Livestock Weighted Average Report for 2/23/2021
Total Receipts: 3,800 Last Reported 2/9/21: 4,424 Last Year: 3,526
Compared to two weeks ago: Feeder steers under 600 lbs mostly steady, over 600 lbs 3.00 to 7.00 higher with instances to 10.00 higher on 650-700 lbs. Feeder heifers under 700 lbs steady to 2.00 higher, over 700 lbs 2.00 to 5.00 lower. Very good demand for this large offering of high quality feeder cattle. Many long strings which resulted in over 2 dozen full loads of steers and heifers. Many replacement quality heifers, the quality of these cattle were outstanding. The market was very active, whether it was for the light weight cattle suitable to background, feeding types, or replacement heifers as there were plenty of buyers eager to get cattle bought. Flesh condition ran more towards moderate plus on the cattle over 700 lbs.
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 2/23/2021
Total Receipts: 1,335 Last Reported 2/9/21: 3,450 Last Year: 1,863
Compared with a couple of weeks ago: Feeder steers and heifers under 700 lbs steady to 2.00 lower, over 700 lbs steady to 1.00 higher. Slaughter cows 2.00 to 3.00 lower. Slaughter bulls mostly steady.
Cattle slaughter from Tuesday estimated at 122,000 head, up 31,000 from last week but down 1,000 from last year. Hog slaughter from Tuesday estimated at 497,000 head, up 86,000 compared to last week and up 4,000 compared to a year ago.
Boxed beef cutout values steady to higher Tuesday on strong demand with 132 loads sold.
Choice Cutout__240.29 +.31
Select Cutout__230.53 +.55
CME Feeder Cattle Index__140.39 -.73
CME Lean Hog Index__78.16 +.42
Pork Carcass Cutout__92.75 +.64
IA/MN Wtd Avg Carcass Base__75.72
National Wtd Avg Carcass Base__73.17 +2.65
February live cattle expire on Friday, safe to say we settle between $114 and $116. The April premium to February has been nearly cut in half this past week. The higher trend is still holding, but this past week’s collapse from the new contract high at $126.70 has erased nearly all the prior month’s gains. Support next at $118.50 then $115.50. March feeders still very choppy these past few months with nearby support around $137 and resistance around $145. April lean hogs holding a sharply higher trend since mid-January, contract high on the 12th at $87.25 with support at $80 and resistance next up around $93, the spot high from the spring of 2019.
The soy complex the leader in the grains yesterday with nearby March soybean futures back above $14 and oil into new contract highs. The gains faded into the close though with March soybeans 19 cents off their highs. South American delayed soybean harvest getting the most attention right now with estimates for Brazil nationwide around 15% complete compared to the average for this time of year around 25% complete. This also backs up their second corn crop planting. Wheat finished mixed yesterday after the leading the charge higher on Monday. Winter wheat crop conditions were released per state, the national ratings will not come out until April, showing conditions only marginally lower in the Southern Plains and IL SRW down 33% in the good to excellent category.
Grains higher again overnight as new crop soybeans hit a new contract high and corn tested the new high from yesterday. Corn finished the overnight 3 to 4 higher, soybeans 5 to 13 higher and wheat 3 to 4 higher.
All March grain contracts first notice day this Friday. If you are long any contracts, please remember to exit those positions before then to avoid delivery risk. There will be no daily trading limits on the March contracts starting Friday and volume will get thin as well.
EIA weekly report could be bearish today as eplants shut down last week but production should be recovering now with demand likely to rebound and continue to grow form here. We could see a drop in ethanol production up to 15% if the weekly data matches up to fully reflect the extreme winter weather.
Heavy rain still in the forecast through the weekend for the Southeast. The 6-10 day outlook showing normal to above normal temps for the eastern half of the U.S. and below normal for the western half with above normal moisture covering the majority of South and eastern half of the U.S. and below normal in North and West.
March corn with the 20-day moving average holding nearby support now at $5.47 ½, resistance at $5.60 with the new contract high from the 9th at $5.74 ¼. March soybeans contract high from mid-January at $14.36 ½ with support at $13.77. March KC wheat still holding the long-term higher trend with support at $6.29 ½, resistance at $6.45 and the contract high at $6.60. March Chicago wheat with support at $6.50, resistance at $6.72 and the contract high at $6.93. March soybean meal with support around $420 and resistance at $443.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700