Date: January 10th, 2022
All livestock futures under pressure to end the week and cattle futures under pressure for most of the week. The hope coming out of the holidays and into a new year would be full capacity slaughter and cash moving back higher. Cash fed cattle trade steady to slightly weaker though compared to the week previous. TX and KS trade at $138 live while trade in NE still holding a slight premium from $138 to $140 live and $220 on a dressed basis. Slaughter last week for both cattle and hogs well below a year ago. Demand has been strong leading to higher product prices, but slaughter must pick back up to keep slaughter ready inventory from building.
Oklahoma Weekly Cattle Auction Summary
Livestock Weighted Average Report for 1/2/2022 – 1/8/2022
Current Week: 30,292 Last Report 12/13/21: 45,864 Last Year: 37,238
Compared to the last report 12/17/2021: Feeder steers steady to 5.00 lower. Feeder heifers steady to 2.00 lower. Demand moderate for feeder cattle. Steer calves under 500 lbs. 4.00-8.00 lower; over 500 lbs. 2.00-5.00 higher. Heifer calves steady to 3.00 higher. Demand moderate to good for calves.
For the week, Friday December 31st through Friday January 7th, December Live Cattle -$2.37, February -$2.77, January Feeder Cattle -$4.77, March -$3.27, February Lean Hogs -$1.82, April +$.62. Boxed Beef, Choice +$5.79 @ $271.82, Select +$2.20 @ $261.10, Pork Carcass Cutout -$.12 @ $85.90.
Cattle slaughter from Friday estimated at 112,000 head and Saturday at 58,000 head. For the week, 620,000 head, up 83,000 from the week previous but down 32,000 from last year. Beef production estimated at 519.9 million pounds, down over 5% from a year ago.
Hog slaughter from Friday estimated at 463,000 head and Saturday at 262,000 head. For the week, 2,578,000 head, up 397,000 compared to the week previous but down 251,000 compared to a year ago. Pork production last week estimated at 559.5 million pounds, down nearly 11% compared to a year ago.
Boxed beef cutout values on Friday sharply higher for Choice and steady to higher for Select on light to moderate demand with 96 loads sold.
Choice Cutout__271.82 +3.26
Select Cutout__261.10 +.46
CME Feeder Cattle Index__161.79 -.49
CME Lean Hog Index__73.73 +.16
Pork Carcass Cutout __85.90 -3.66, loins -4.96 and hams -11.48
National Wtd Avg Carcass Base__ 66.95 -1.65
February live cattle higher trend now more of a sideways or range bound trading pattern with support at the December low at $135.50, resistance at the December high at $141.42 and contract high was hit on November 29th at $141.85. January feeders remain choppy as well with support around $160 then December low down at $158.40, resistance at $167.50 and $168.30. February lean hogs chopping in a $14 range since June with nearby support around $80 breached last week, the next around $75 and resistance at December’s high at $84.65 with the November high just 1 tick above that.
Grains ended the week higher as the soy complex continues to be the leader, nearby soybean meal into new contract highs. Hot and dry conditions this past week and in the forecast for Argentina. USDA will update world numbers this Wednesday as most expect to see production decreased in both Argentina and Brazil. Wheat continues to slide lower led by KC and MPLS wheat futures as limited new fundamental news is available to add to the recent rally. Limited export demand has been concerning and it would not surprise me to see USDA reducing the U.S. wheat export estimate yet again. World stocks could also be bearish as an increase is expected for Argentine and Australia wheat production estimates.
For the week, Friday December 31st through Friday January 7th, March Corn +$.13 ½, May +$.12 ¾, March Soybeans +$.71, May +$.69 ¾, March KC Wheat -$.26 ½, July -$.22 ¼, March Chicago Wheat -$.12 ¼, July -$.07 ½, March MPLS Wheat -$.58 ¾, September -$.29, March Soybean Meal +$25.90/T, May +$23.80/T.
All commodities fairly quiet overnight. Energies mixed and trading both sides of unchanged, US$ is higher and equities pointing lower. Grains were also mixed overnight but finished a bit weaker with corn 3 to 3 lower, soybeans 5 to 6 lower and wheat 5 to 10 lower. USDA announced a private sale this morning or 132,000 MT or 5.2 MBU of corn for delivery to Mexico split between this year and new crop.
The following are the average trade estimates for Wednesday’s USDA crop report…
U.S. corn production slightly higher at 15.07 BBU with a yield of 177 BPA
U.S. soybean production also slightly higher at 4.433 BBU with a yield of 51.3 BPA
U.S. corn ending stocks though expected to be lower, 1.47 BBU vs. 1.493 BBU last month
U.S. soybean ending stocks slightly higher at 348 MBU vs. 340 MBU last month
U.S. wheat ending stocks also expected higher, 608 MBU vs. 598 MBU last month
U.S. 2022 Winter Wheat planted acres at 34.26 million vs. 33.648 million acres last year
World corn ending stocks at 304.1 MMT vs. 305.54 MMT last month
World soybean ending stocks at 99.9 MMT vs. 102 MMT last month
World wheat ending stocks at 278.7 MMT vs 278.2 MMT last month
Below normal temps continue this week for the Northern Plains with heavy rains in the Southeast. The 6-10 day outlook showing above normal temps for the western half of the U.S. and below normal for the Northeast with below normal moisture out West as well and above normal in the Northern Plains and the Southeast. In South America, the forecast remains mostly hot and dry early this week in southern Brazil and Argentina, with better chance for relief next week.
March corn still holding the higher trend with support at $5.96 then $5.85 and resistance $6.11 then the December high at $6.17 ¾. March soybeans hit a new 7-month high last Friday at $14.15, the contract high from June up at $14.45 ½, support at $13.75. March KC wheat breaking nearby support last week with the next down at $7.50 and resistance at $8.20. March Chicago wheat holding a lower trend since the late November contract high with support next at $7.15 and resistance at $7.68 then $7.93. March MPLS wheat down over $1.30 since December 27th with support next around $8.90 and resistance at $9.92. March Soybean Meal hit a new contract high last Friday at $431.80 with support at $405.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700