Date: June 11th, 2021
Livestock futures finished will small gains after spending most of the day in the red. Live cattle continue to trade a very tight range, feeders keeping both eyes on corn prices and lean hogs continue to hit new contract highs. Cash feedlot trade looks to be wrapped up for the week at $119 to $120 live and $190 to $191 dressed, steady now for almost 2 months. USDA made a few adjustments to the meat balance sheet yesterday, the friendly news coming from increased exports for both pork and beef. 2021 beef production increased 5 million pounds and imports up 60 million but more than offset by the 115 million pound increase in exports. Imports for 2022 increased by 40 million pounds and exports up 75 million pounds. Pork production actually decreased by USDA yesterday by 30 million pounds, imports up 15 million and exports up 125 million pounds. For 2022, exports also increased by 125 million pounds. Bearish to both pork and beef was the 164 million pound increase in total poultry production along with projections for domestic consumption of both beef and pork projected slightly lower than a month ago with total poultry domestic consumption increasing.
Winter Livestock – Pratt, KS
Livestock Weighted Average Report for 6/10/2021
This Week: 4,717 Last Week: 2,380 Last Year: 3,450
Compared to last week, feeder steers 700 lb to 975 lb sold 2.00 to 3.00 lower. Approximately 15 loads of fancy feeder steers weighing 875 lb to 975 lb sold steady to 1.00 higher. Steers 975 lb to 1100 lb sold 1.00 to 2.00 higher. Feeder heifers 600 lb to 900 lb sold steady. Heifers 900 lb to 975 lb sold 2.00 higher. Demand was moderate. Slaughter cows sold 1.00 to 2.00 lower. Slaughter bulls sold 1.00 to 2.00 higher.
Woodward Livestock Auction Feeder Cattle – Woodward, OK
Livestock Weighted Average Report for 6/10/2021
This Week: 5,033 Last Week: 2,597 Last Year: 5,348
Compared to last week: Feeder steers steady to 4.00 higher. Feeder heifers mostly steady. Steer and heifer calves to lightly tested last week for a market trend but a stronger undertone was noted. Quality average. Demand was moderate.
Mitchell Livestock Auction – Mitchell, SD
Livestock Weighted Average Report for 6/10/2021
This Week: 8,106 Last Week: 2,696 Last Year: 8,715
Compared to last week: Much larger offering of feeder cattle this week, steers under 800 lbs not well tested last week to offer a comparison, over 800 lbs steady to 1.00 higher with an instance of 4.00 higher on 950-1000 lbs. Feeder heifers steady to 2.00 higher with an instance of 4.00 higher on 800-850 lbs. Very good demand for this large offering of feeder cattle.
Billings Livestock Commission Cattle Auction – Billings, MT (Thu)
Livestock Weighted Average Report for 6/10/2021
This Week: 3,430 Last Report 5/27/21: 2,703 Last Year: 2,501
Compared to the last reported sale (5-27-2021), feeder steers sold uneven. Steers 500 to 700 lbs sold weak; steers 700 to 850 lbs sold strong; steers 850 to 1000 lbs sold weak. Feeder heifers overall sold weak. Feeder bulls sold strong on a light comparison. Buyer demand was moderate on a moderate supply for the feeder cattle. Good demand was noted on large drafts of feeders. Slaughter breaker cows sold 2.00 to 3.00 higher on a light comparison; slaughter boner cows sold 1.00 to 2.00 higher; slaughter lean cows sold steady. Buyer demand for the slaughter cattle was moderate with good demand noted on higher quality cows. Replacement stock cows sold strong. Cow-Calf pairs sold strong. Buyer demand was moderate to good on stock cows with moderate demand on cow-calf pairs. Good demand was noted on heavier cows and calves.
Cattle slaughter from Thursday estimated at 121,000 head, up 1,000 from last week and up 5,000 from last year. Week to date now at 476,000 which means we have a shot to get up to the 670,000 head mark this week. Hog slaughter from Thursday estimated at 482,000 head, up 12,000 compared to a week ago and up 27,000 compared to a year ago. Week to date now at 1,930,000 head which means we should be able eclipse 2.5 million head this week.
Boxed beef cutout values Thursday lower on Choice and again higher on Select on moderate to good demand with 110 loads sold.
Choice Cutout__338.25 -.40
Select Cutout__310.40 +2.53
CME Feeder Cattle Index__139.91 -.13
CME Lean Hog Index__119.91 +1.20
Pork Carcass Cutout__134.05 -.33
IA/MN Wtd Avg Carcass Base__124.66 +.80
National Wtd Avg Carcass Base__119.72 +4.72
June live cattle able to hit a new recent high but still unable to push through the $118 level even in delivery and trading $1 to $2 lower than current cash. August feeders very volatile with the back and forth grains over the past two months. Nearby resistance at $152 and support down at $145. June lean hogs expire Monday and volume getting thin with a new contract high at $122.65 yesterday. The July contract carrying the heaviest volume now with support at $120, the contract high hit Monday and Tuesday at $123.60 and the next upside target at $133.87, the all-time spot high from July 2014.
Grains mixed yesterday but finished mostly higher from the friendly crop report, at least for corn that is. U.S. corn ending stocks reduced by 150 MBU, both exports and corn used for ethanol each increased 75 MBU as demand continues to be strong. U.S soybean stocks were increased by 15 MBU as domestic crush was reduced by the same amount. Winter wheat production was increased as expected as yields are projected higher than a month ago with the good weather in the Southern Plains during the month of May. Old crop exports were increased by 20 MBU which decreased the ending stocks by the same amount and roles into new crop beginning stocks. All wheat production increased by 26 MBU and feed usage increased 10 MBU resulting in a decrease of new crop ending stocks of 4 MBU.
USDA adjusted Brazil soybean production 1 MMT higher to 137 MMT and decreased corn production 3.5 MMT to 98.5 MMT. Brazil’s CONAB also updated production estimates yesterday morning by increasing soybean production .45 MMT to 135.86 MMT but dropping corn production a massive 10 MMT to 96.39 MMT. This is the second month in row of reduced second crop corn production for Brazil. Persistent drought conditions continue to push yield estimates lower. World wheat production was increased by 5.46 MMT yet ending stocks only increased 1.84 MMT as usage and exports were increased. USDA increased the EU production by 3.5 MMT, U.S. by .71 MMT, Ukraine .5 MMT and Russia by 1 MMT for a new record production estimate at 86 MMT. Russia’s Sovecon raised its production forecast by 1.5 MMT but still lower than USDA at 82.4 MMT.
Grains under pressure overnight led by the soy complex. Soybean oil down over $.02/pound, breaking through nearby support after hitting new all-time highs earlier this week. Soybeans finished 12 to 22 lower, meal only off $1/T, corn 8 to 12 lower and wheat 5 to 12 lower.
The Philippines bought a cargo of feed wheat from Australia and South Korea booked a cargo of feed wheat from Black Sea origins. No USDA daily sales announced this entire week.
Rains again over the past 24 hours in the Dakotas. There is a cold front sweeping in from Canada to KS that could provide some relief for the WCB today but back to hot and dry again over the weekend and into next week. The 6-10 day outlook continues to show above normal temps, now pulling west as normal to even below normal temps appear in the ECB with below normal moisture for all except the Southwest and TX Gulf.
July corn hit a new recent high yesterday at $7.17 ½ with the contract high the next resistance at $7.35 ¼ and nearby support around $6.80. December corn into a new recent yesterday also at $6.28 ¼ with the contract high the next resistance at $6.38 and support at $5.89. July soybeans with resistance at Monday’s high at $16.23 ½ and support around $14.90. November soybeans hit a new contract high Monday at $14.80 with support at $14.26. July KC wheat with support around $6.20 and resistance at $6.54. July Chicago wheat with support at $6.70 and resistance around $7.00. July MPLS wheat with support at $7.37 and resistance up around $8.00. July soybean meal back to testing support around $380 and resistance at $403.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700