Date: October 19th, 2021
Livestock futures mixed yesterday with live cattle posting an inside trading day, feeders triple digits lower and lean hogs showing some follow through buying but on light volume. Cash feedlot trade yet to develop as midweek high volume looks to play out again. There could be some business holding off until after the Cattle on Feed report to be released after the close this Friday. China reported September pork imports down 44% compared to a year ago and year to date pork imports down 4.3%. This reduction has led to some of the recent pressure but will also be important moving forward as we still need to see long term pork demand expand.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 10/18/2021
This Week: estimated 6,500 Last Week: 7,410 Last Year: 5,974
Compared to last week: Feeder steers and heifers 1.00 – 3.00 higher. Steer calves 2.00 – 4.00 higher. Heifer calves unevenly steady. Demand moderate to good. Quality average to attractive.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 10/18/2021
This Week: 4,276 Last Week: 3,458 Last Year: 3,576
Compared to last week: Steers 7.00-9.00 higher. Heifers 5.00-8.00 higher. Demand good. Quality good thru attractive. Slaughter cows steady to 4.00 higher.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 10/18/2021
This Week: 4,494 Last Week: 3,728 Last Year: 4,826
Compared to last week, feeder steers traded 2.00-9.00 higher with the most gain on weights over 750 lbs. Feeder heifers traded steady to 2.00 higher.
Cattle slaughter from Monday estimated at 120,000 head, down 1,000 from last week but up 1,000 from last year. Hog slaughter from Monday estimated at 478,000 head, up 1,000 compared to last week and to a year ago.
Boxed beef cutout values on Monday slightly lower on moderate demand with 115 loads sold.
Choice Cutout__280.09 -.15
Select Cutout__259.81 -.81
CME Feeder Cattle Index__153.90 +.55
CME Lean Hog Index__86.88 -.71
Pork Carcass Cutout__100.78 -.54
National Wtd Avg Carcass Base__67.24 -.09
October live cattle testing resistance at $126, but unable to push through over this past week, support at $123. Only a week and a half 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 and a lower trend holding since with support at $155 then the recent low at $151.92. December lean hogs still range bound with nearby resistance at $80 and support around $77.
Grains were mostly higher to begin the week after mostly lower overnight trade on Sunday. Export inspections for the week ending October 14th were very impressive for soybeans at 84.4 MBU. China was the #1 destination taking 61 MBU followed by Egypt, Germany and Mexico. Year to date still only half of last year at this time but last week’s total was more than double the weekly average needed. Corn inspections solid at 38.4 MBU as Mexico continues to be the #1 destination at 13.9 MBU followed by China, Japan and Colombia all taking over 5 MBU. The pace has improved and only behind a year ago by 26% but the average per week is over 50 MBU. Wheat inspections were disappointing at only 5.1 MBU as the average per week needed is three times that. Wheat inspected for Mexico totaled 1.5 MBU followed by Venezuela at 1.2 MBU.
After the close, USDA updated crop progress and conditions for the week ending October 17th. Corn harvest still ahead of average pace nationwide at 52% complete along with soybean harvest at 60%. Grain sorghum harvest at 59% complete. Winter wheat planted at 70% nationwide and emergence at 44%, both slightly behind a year ago and the 5-year average.
Grains trading both sides on unchanged again overnight but able to hold small gains with corn finishing steady to ½ higher, soybeans 3 to 5 higher and wheat 4 to 6 higher. Crude oil steady to higher and equites pointing higher this morning as the US$ is lower.
News again light overnight providing little new direction the grains. Brazil planting around 1/3 complete and Ukraine has planted around 3/4 of their winter wheat crop. South American weather currently non-threatening with regular rounds of showers in Northern Brazil, drier conditions expected and needed in Southern Brazil and a good planting window for Argentina expected through the end of the month but some areas getting a little dry.
The U.S. forecast this week showing some scattered rain chances from Wyoming to the Great Lakes then filling in around the Corn Belt over the weekend and into early next week. The 6-10 day outlook still showing above normal temps across the majority of the country, below normal on the West Coast and in the Northeast with above normal moisture now across most of the U.S. with below normal in the Southwest and Northeast.
December corn still holding the long term lower trend with support around the $5 level and resistance at $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 $7.20 and resistance at $7.54. December Chicago wheat also a long term higher trend with support at $7.12 and resistance around $7.60. December MPLS wheat another new contract high on Friday at $9.80 and support at $9.30. December Soybean Meal bouncing off the new 12-month low last week at $309.3 with resistance at $325.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700