Date: December 1st, 2021
Another sharply lower day for almost all commodities, yes I said all, not just Ag. The only ones higher were lumber, deferred feeders held onto gains as well as the nearby Lean Hogs and Soybean Meal which is now in delivery. The uncertainty of the new CVOID variant continued to impact all markets for the past three trading sessions as both equites and energies were again sharply lower yesterday as well. Something to remember, panic and fear bring on selling and then we ask questions later.
Cash feedlot trade only light volume so far this week at $137 to $137.50 live and $218 dressed in the North and $138 to $139 live in the South. These are all above the weighted average of last week’s trade which peaked at $140 live and $220 dressed. Cattle futures are holding up the best across the Ag commodities and should be with the rallying cash fat cattle market and lower grains. Nothing has really changed from last week in regards to larger fed cattle supplies being available to the packer, so it would seem hard for packers to be able to buy cattle any cheaper this week or next.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 11/29/2021
This Week: 10,817 Last Week: 9,605 Last Year: 10,159
Compared to last week: Feeder steers 2.00 – 4.00 higher. Feeder heifers 3.00 – 5.00 higher. 7 weight index steers averaging $164 with the 8 weight index steers averaging $162-$165. Steer and heifer calves 4.00 – 6.00 higher with instances 15.00 higher. Quality average to attractive. Demand again very good for all classes.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 11/29/2021
This Week: 3,761 Last Week: 3,329 Last Year: 2,798
Compared to last week: Steers 4.00-7.00 higher. Value Added Steers 6.00 Higher. Heifers 3.00-6.00 higher. Value Added heifers 5.00 higher. Quality good. Demand good.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 11/29/2021
This Week: 8,342 Last Week: 12,811 Last Year: 9,399
Compared to last week feeder steers under 600 lbs. traded 3.00-8.00 higher, with heavier weights trading steady. The 7 weight index steers in Joplin averaged $161-$162, the 8 weight index steers averaged $160-$164, and the 9 weight steers averaged $157. Feeder heifers traded 3.00-9.00 higher with the most advance on weights under 500 lbs. Supply heavy with demand good to very good.
Sioux Falls Regional Cattle Auction – Worthing, SD
Livestock Weighted Average Report for 11/29/2021
This Week: 2,893 Last Week: 2,333 Last Year: 3,496
Compared to last week: Feeder steers steady to 3.00 higher, 600-650 lbs took a significant jump higher. Feeder heifers steady to 2.00 higher except 600-750 lbs 10.00 to 11.00 higher. Demand for this large offering of green cattle was good. Yearlings were in very high demand again this week. Black hided cattle are in biggest demand. The 7 weight index steers in Worthing averaged $162-$166, the 8 weight index steers averaged $159, and the 9 weight steers averaged $158-$160.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 11/30/2021
This Week: 3,390 Last Week: 1,485 Last Year: 4,262
Compared to last week, steer and heifer calves under 500 lbs. traded 8.00-12.00 higher with heavier weights trading 4.00-8.00 higher. Demand was good on a moderate supply.
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 11/30/2021
This Week: 3,375 Last Week: 1,858 Last Year: 4,507
Compared with last Tuesday: Steer and heifers with quality an condition weaned 50 days or longer 5.00 to 8.00 instances 10.00 higher. Yearling feeder steers and heifers over 700 lbs 3.00 to 5.00 instances 8.00 higher.
Miles City Livestock Commission Auction – Miles City, MT
Livestock Weighted Average Report for 11/30/2021
This Week: 3,790 Last Week: 1,558 Last Year: 3,029
Compared to last week: Yearling steers and heifers were too lightly tested to develop any market trend. Demand for yearlings was moderate to good for light offerings. Feeder steers were all too lightly tested last week to develop an accurate market trend, however higher undertones were noticed. The best test for feeder heifers was for 450-549 lbs which sold mostly 3.00-5.00 higher in a narrow comparison. All other weights of heifers were too lightly tested to trend, however higher undertones were noticed. Quality this week was average to very attractive.
Cattle slaughter from Tuesday estimated at 122,000 head, matching last week and last year. Most projecting weekly cattle slaughter over the next 3 weeks to exceed 660,000 head to be able to keep up with orders and robust exports. Hog slaughter from Tuesday estimated at 480,000 head, matching a week ago but down 8,000 compared to a year ago.
Boxed beef cutout values on Tuesday lower on very strong demand with 199 loads sold.
Choice Cutout__271.68 -5.90
Select Cutout__260.29 -1.73
CME Feeder Cattle Index__161.29 +3.34
CME Lean Hog Index__70.04 -.56
Pork Carcass Cutout__86.70 -1.01
National Wtd Avg Carcass Base__56.60 +1.45
No technical/chart damage yet for cattle. December live cattle went down and filled the gap from last week with support around $134 and the new contract high from Monday up at $139.12. January feeders hit a new 2-month high just above $168 earlier this week with resistance next around $170, the contract high at $172 and support at $162 then at $160. December lean hogs back down near the lows from September and October providing support with resistance at $78.
Over in the grains, it wasn’t a Turnaround Tuesday, but a complete washout that looks to be a bit overdone. Added pressure on the grains yesterday with end of the month trading and first notice day for all December contracts. Fundamentally not much has changed though since hitting new recent highs for corn and new contract highs for wheat last week. South American forecasts a tad wetter, Australia projecting a record canola crop and higher wheat production but with quality concerns and chatter than Brazil may be able to hit late January and potentially record February soybean exports. Yet U.S. weekly export sales were strong for both corn and beans and soybean shipments have been friendly, still behind last year’s pace due to the hurricane damage earlier this fall in the Gulf.
Grains stabilizing and closing higher overnight. Corn finished the 2 to 5 higher, soybeans 3 to 9 higher and wheat steady to 9 higher. Equites pointing higher, only about half of yesterday’s loss so far and crude back up $1 to $2/barrel.
USDA announced a daily export sales this morning of 150,000 MT or 5.9 MBU of corn for delivery to Colombia. USDA census crush report for October will be released after today’s close. The average estimate is at 195.6 MBU of soybeans processed domestically compared to 164.1 MBU in September and last October at 196.6 MBU which is the all-time high for a single month. Soybean oil stocks expected to be higher than a month ago. Stats Canada will update crop production estimates this Friday and USDA will update supply and demand next Thursday.
Warm and dry weather expected across most of the U.S. for the balance of this week. Weekend and early next week rains are in the forecast for the Southeast up through the ECB. The 6-10 day outlook still showing normal to above normal temps across the entire country with above normal moisture across the northern half and below normal centered directly on the Southern Plains. This should remain supportive to wheat as warm and dry conditions continue. Below normal moisture in the 6-10 day forecast for Southern Brazil and Argentina but extended forecasts calling for better rains.
December corn trying to hold the higher trend since mid-October, up to a new recent high last week at $5.89 with the next upside target at $5.94 ¼, the spike high from mid-August, support down around $5.50. January soybeans breaking above the long term lower trend this month but choppy for a week and now back lower since with resistance at $12.89 and support next at the $12 level then the recent low down $11.81 ¼. December KC wheat a new contract high last week at $8.87 ¼ with nearby support taken out this week around $8.50 and then next down at $8.15. December Chicago wheat also a new contract high last week at $8.63 ¼ with support next at $7.63. December MPLS wheat contract high back on November 2nd at $10.86 ½ with support at $10.00. December Soybean Meal still holding a higher trend since mid-October with support at $340 and resistance at $380.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700