Date: February 2nd, 2022
Green across the entire Ag sector except for the nearby lean hog contract set to expire the end of next week. February hogs did hit a new recent high before falling off as deferred hogs and deferred feeders hit new contract highs. The bullish semi-annual Cattle Inventory from USDA after the close Monday helped support further gains, yet seems like most of that was already baked in on Monday’s sharply higher trading. Cash fed cattle trade steady to $2 higher so far this week on only light volume in the North at $138 to $141 live and $218 to $220 dressed.
Tulsa Livestock Auction – Tulsa, OK
Livestock Weighted Average Report for 1/31/2022
This Week: 3,390 Last Report 1/24: 2,931 Last Year: 2,521
Compared to last week: Steers 2.00-4.00 higher. Value added steers 5.00 higher. Heifers unevenly steady to 3.00 higher. Value added heifers 1.00-2.00 higher. Demand good.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 1/31/2022
This Week: 11,125 Last Report 1/24: 12,274 Last Year: 10,758
Compared to last week: Feeder steers unevenly steady. Feeder heifers steady to 3.00 higher. Steer calves unevenly steady. Heifer calves 2.00 – 4.00 higher. Demand moderate for all classes. 7 weight index steers averaging $156-$158 and the 8 weight index steers averaging $148-$153.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 1/31/2022
This Week: 9,006 Last Report 1/24: 10,019 Last Year: 4,016
Compared to last week feeder steers and heifers traded steady. Supply heavy with good demand. 7 weight index steers averaged $158-$159 and 8 weight index steers averaged $152-$154.
Sioux Falls Regional Cattle Auction – Worthing, SD
Livestock Weighted Average Report for 1/31/2022
This Week: 4,184 Last Report 12/20: 5,257 Last Year: 4,072
Compared to last week: Feeder steers 350 lbs, 500 – 600 lbs steady to 3.00 higher, 400 – 500 lbs 2.00 to 8.00 lower, 600 – 800 lbs 5.00 to 9.00 higher, 800 -950 lbs 1.00 lower to 4.00 higher. Feeder heifers steady to 5.00 higher except, 400 – 450 lbs 6.00 to 7.00 lower, 700 – 750 lbs 9.00 to 10.00 higher.
Winter Livestock (Tuesday) – La Junta, CO
Livestock Weighted Average Report for 2/1/2022
This Week: 2,583 Last Report 1/25: 1,896 Last Year: 2,692
Compared with last Tuesday: Steer’s under 700 lbs 3.00 to 5.00 higher, over 700 lbs steady to 2.00 higher. Heifer’s under 700 lbs steady to 2.00 higher, over 700 lbs mostly steady. Slaughter cows and bulls steady to 1.00 higher. Trade active, Demand good.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 2/1/2022
This Week: 3,173 Last Report 1/25: 3,336 Last Year: 3,404
Compared to last week, steer calves traded 2.00-5.00 higher while heifer calves traded uneven from 3.00 lower to 3.00 higher. Yearlings were not well tested. Demand was moderate on a moderate supply.
Cattle slaughter from Tuesday estimated at 121,000 head, up 3,000 from last week and from last year. Hog slaughter from Tuesday estimated at 480,000 head, up 9,000 compared to a week ago but down 7,000 compared to a year ago.
Boxed beef cutout values sharply lower on moderate to strong demand with 127 loads sold.
Choice Cutout__285.44 -4.96
Select Cutout__280.22 -3.05
CME Feeder Cattle Index__158.77 +.33
CME Lean Hog Index__83.14 +.99
NO cash hog or pork data due to packer submission issues yesterday
February live cattle still bouncing in a $6+ range since early November with support at $135.50 and resistance at the contract high from November 29th at $141.85. March feeders closed the gap left from last week’s collapse with support just above $158 and resistance next around $165. February lean hogs continue to make new recent highs, up to $89.50 yesterday with the contract high from June 10th up at $90.97 and support around $83.
New contract highs for soybeans both old and new crop, soybean meal and new crop corn as managed money or funds continue to buy with both hands on Tuesday. Near perfect weather is needed this month in South America to avoid any additional crop loss, yet forecasts are still mixed and calling for more hot and dry conditions over the next couple weeks. The combined loss (Brazil/Argentina/Paraguay) is thought to be from 27 to 31 MMT of soybeans, around 1 billion bushels, compared to early season production estimates. Corn combined loss being traded right now is from 17 to 21 MMT or 700 to 800 million bushels of corn. China will be on holiday this week yet still we saw USDA announce flash soybeans sales both Monday and Tuesday which continues to support the market.
USDA Monthly Domestic Processing Reports
Grain Crushings and Co-Products Production
Total corn consumed for alcohol and other uses was 539 MBU million bushels in December 2021. Total corn consumption was up 4% from November 2021 and up 12% from December 2020. December 2021 usage included 92.5% for alcohol and 7.5% for other purposes. Corn for fuel alcohol, at 486 MBU, up 4% from November 2021 and up 13% from December 2020.
Fats and Oils: Oilseed Crushings
Soybeans crushed for crude oil was 5.95 million tons (198 MBU) in December 2021 vs. 5.72 million tons (191 MBU) in November 2021 and 5.79 million tons (193 MBU) last December.
Flour Milling Products
All wheat ground for flour during the fourth quarter 2021 was 235 MBU, up 2% from the third quarter 2021 and up 1% from the fourth quarter 2020.
Grains continued the rally overnight, again led by the soy complex with new contract highs for beans and meal. Equities pointing higher this morning, crude $1 higher with the nearby contract breaking $89 for the first time since October 2014, US$ lower. Soybeans finished the overnight 13 to 30 higher, meal $8/T higher, corn 1 to 4 higher and wheat 3 to 10 higher.
Not much in the terms of new news or additional bullish news overnight. Soybeans sales announced by USDA again this morning. This time it is 380,000 MT or just shy of 14 MBU sold for unknown destinations.
Forecasts for Argentina, southern Brazil and Paraguay show rising temperatures, not nearly as hot as the first half of January though and mixed to sporadic rainfall. Recent moisture now declining and a return to the hot and dry which will stress crops next week and in the 10-14 day outlook.
Overnight snow from Kansas to Michigan and rain in the Southeast. Snow and mixed precipitation continues today and into tomorrow from the Southwest into the ECB. The 6-10 day outlook showing above normal temperatures on the West Coast, Northern Plains and WCB and below normal in the South and eastern half of the U.S. with below normal precipitation for most of the country, above normal only showing in south TX and the Northern Border States.
March corn contract high on Monday at $6.42 ½ with support at $6.20 then $6.10. These are the highest nearby prices since last summer when we hit $7.50 in July and up to $7.75 in May. December 2022 corn also hit a new contract high overnight at $5.80 ¼. March soybeans a new contract high overnight at $15.64, with support around $14.60. This is the highest nearby price since last June when the nearby contract got up to $16.23 ½ and $16.77 ¼ last May. November 2022 soybeans also hit a new contract high overnight at $13.99. March KC wheat still holding a lower trend the past 2 months with support at $7.75 and resistance at $8.17. March Chicago wheat trading in a channel lower with support being tested this week around $7.60 and resistance just under $8.00. March MPLS wheat with support around $9.00 and resistance at $9.70. March Soybean Meal a new contract high overnight at $447.60, the highest nearby price since May of last year which topped at $456, support around $409.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell
www.loewenassociates.com matt@loewenassociates.com
866-341-6700