Date: October 18th, 2021
Livestock futures mixed last week as live cattle rallied to new recent highs but both feeders and lean hogs were flat to under pressure all week. Cash feedlot trade held steady in the South at $124 live with NE adding $2 from the week previous to match at $124 live and dressed trade steady at $196. The monthly supply and demand report was friendly for cattle with increased production, increased domestic consumption and decreased pork and poultry production. The next fundamental update will come this Friday with the October Cattle on Feed report. The early estimates are looking for placements to be slightly higher than a year ago, marketings lower and on feed right in line with last year.
Oklahoma Weekly Cattle Auction Summary
Livestock Weighted Average Report for 10/10/2021 – 10/16/2021
Total Receipts Current Week: 27,591 Previous Week: 28,987 Last Year: 30,003
Compared to last week: Feeder steers steady to 2.00 higher. Feeder heifers sold 1.00-5.00 higher. Demand moderate to good. Steer calves 1.00-5.00 higher. Heifer calves sold steady to 5.00 lower. Demand moderate for calves with most action on longer weaned calves.
For the week, Friday October 8th through Friday October 15th, October Live Cattle +$.40, December +$.95, October Feeder Cattle -$1.90, November +$.27, December Lean Hogs -$3.22, February -$2.55. Boxed Beef, Choice -$3.03 @ $280.24, Select -$2.12 @ $260.62, Pork Carcass Cutout -$5.67 @ $101.32.
Cattle slaughter from Friday estimated at 107,000 head and Saturday at 59,000. For the week, 646,000 head, down 11,000 from the week previous and down 13,000 from last year. Beef production last week estimated at 535.1 million pounds compared to 544.1 million the week previous and 555.3 million last year. Year to date beef production +2.8% compared to last year and slaughter +3.2%.
Hog slaughter from Friday estimated at 477,000 head and Saturday at 256,000. For the week, 2,637,000 head, up 40,000 compared to the week previous but down 48,000 compared to a year ago. Pork production last week estimated at 557 million pounds compared to 547.1 the week previous and 580.2 million last year. Year to date pork production -2.0% compared to a year ago and hog slaughter remains -1.9%.
Boxed beef cutout values on Friday steady to slightly lower on good demand with 154 loads sold.
Choice Cutout__280.24 -.08
Select Cutout__260.62 -.06
CME Feeder Cattle Index__153.35 -.66
CME Lean Hog Index__87.59 -1.23
Pork Carcass Cutout__101.32 -4.74
National Wtd Avg Carcass Base__67.33 -.96
October live cattle testing resistance at $126, but unable to push through last week, support at $123. Only a couple weeks left until expiration and cash still hanging on right at $124. The highest volume December contract also testing resistance right around $131 with support at $128. October feeders hitting resistance just above $160 early last week but a lower trend since with support at $157. December lean hogs trading an $18 range since March with nearby resistance at $80 and support around $71.50.
A wild week for the grains with new recent lows for corn and soybeans as USDA increased crop production estimates midweek but corn almost full recovered. Daily soybean sales were announced three days in row for a total of 55.7 MBU to either China or unknown destinations which is supportive. Year to date sales are still behind last year with shipments finally getting back to normal after nearly a month of low shipments out of the Gulf due to hurricane damage. The USDA report was bullish for wheat but both KC and Chicago wheat tested the trendline support the day after yet quickly rebounded to end the week as MPLS wheat continues to make new highs daily. Weather this week wide open for fall harvest to progress as most were rained out this past week.
For the week, Friday October 8th through Friday October 15th, December Corn -$.04 ¾, March -$.05 ¼, November Soybeans -$.25 ¼, January -$.28, December KC Wheat +$.06 ¼, March +$.05, December Chicago Wheat unchanged, March -$.00 ¾, December MPLS Wheat +$.22 ¼, March +$.21 ½, December Soybean Meal -$2.10/T, December Soybean Oil -.22 cents/lb.
Grains trading both sides on unchanged overnight but in the red this morning with corn 1to 2 lower, soybeans 6 lower and wheat steady to 3 lower. Crude into new highs, breaking above $83 while equites are pointing lower.
Not much new news over the weekend. Chinese data shows September wheat imports down 40% from a year ago. Corn imports for September +226% vs. a year ago and grain sorghum +14%. Corn prices have cheapened their domestically as wheat has rallied allowing feedmills to switch rations back to higher corn usage. Pork production for the third quarter back up to 2018 levels, prior to the African swine fever outbreak.
Rains over the weekend limited to the ECB and Northeast with this week’s forecast showing some scattered chances late in the week for the WCB and heavy rains for the West Coast. The 6-10 day outlook still showing above normal temps across the majority of the country, below normal only on the West Coast with above normal moisture on the West Coast and WCB and below normal in the Southwest and East Coast.
December corn still holding the long term lower trend with nearby support taken out on Tuesday, the next down around the $5 level and resistance at $5.34 then $5.48. November soybeans also holding the lower trend with new 6-month lows last week at $11.84 ½ and resistance at $12.50. December KC wheat holding a higher trend since early July with support around $7.15 and resistance up around $7.60. December Chicago wheat also a long term higher trend with support at $7.12 and resistance around $7.60. December MPLS wheat yet another new contract high on Friday at $9.80 and support at $9.30. December Soybean Meal a new 12-month low last week at $309.3 with resistance at $320.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700