Date: August 9th, 2022
Livestock futures took an hour or so to get going yesterday morning, but strong gains held throughout the day. Live cattle supported by higher cash trade last week and higher equites. That in turn helps support the feeder markets as well with corn under some pressure to begin the week. Lean hogs trading and nearly holding triple digits higher on the front two months on Monday as higher trends hold for all three and lean hogs the closest to take a run at contract highs from this spring.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 8/8/2022 – Prelim
This Week: 7,500 Last Week: 9,112 Last Year: 8,231
Compared to last week: Feeder steers unevenly steady. Feeder heifers steady to 3.00 higher. Steer calves unevenly steady. Heifer calves steady to 3.00 higher.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 8/8/2022 – Final
This Week: 4,013 Last Week: 7,386 Last Year: 4,122
Compared to last week feeder steers traded steady to 4.00 lower. Feeder heifers traded 3.00-8.00 higher with the most gain on weights under 575 lbs. Supply was light with moderate demand.
Cattle slaughter on Monday estimated at 119,000 head, down 5,000 from last week but up 6,000 from last year. Hog slaughter on Monday estimated at 458,000 head, up 50,000 compared to a week ago and up 2,000 compared to a year ago.
Boxed beef cutout values on Monday higher on moderate demand with 105 loads sold.
Choice Cutout__266.24 +1.62
Select Cutout__238.86 +.19
CME Feeder Cattle Index__175.31 -.12
CME Lean Hog Index__121.92 -.17
Pork Carcass Cutout __124.06 -.97
National Wtd Avg Cash Carcass Base__122.84 -1.59, 6,700 head
August live cattle breaking through the $138 resistance area and holding a higher trend with the next resistance up at $139, a gap on the charts up to $140.27 and support at $136. August feeders holding a 2 ½ month long higher trend with support at $177 then $175.20. A new recent high was hit yesterday with resistance right around $182. August lean hogs also holding a higher trend but expiring this Friday. October also trending higher over the past few weeks and into a new recent high yesterday at $100.75. The contract high is just above that at $100.82 and nearby support is at $95.
Grains actually traded both sides of unchanged to start the week looking for direction and receiving mixed signals. On the bullish side is last week’s hot and dry conditions, the extended forecasts still calling for mostly hot and dry, 6 cargoes of new crop soybeans to China and unknown destinations over the past two trading sessions and decent weekly export inspections.
The bearish side includes some better than expected rainfall over the weekend for parts of the Corn Belt, 10 grain vessels now shipped out Ukraine in the past week and the relentless sabre rattling and military exercises by China around Taiwan.
Grains inspected for the week ending August 4th all right at or exceeding their weekly average needed to meet the current USDA export estimate. Corn totaled 21.9 MBU with the top 3 destinations of China, Mexico and Japan. Soybeans jumped up to 31.9 MBU with the top 3 destinations of China, Germany and Japan. Wheat also popped higher at 22.2 MBU with Mexico again the top destination and a surprise cargo each to Brazil and Ecuador.
After the close, USDA updated crop progress and conditions. Corn conditions dropped 3 points in the good to excellent ratings which was more than expected. Soybeans only down 1 point. Both continue to show crops moving backwards in the Plains and WCB with continued improvement in the ECB.
The deteriorating crops, hot and dry and weather private estimates for Friday’s crop report supporting the grains overnight which held decent gains. Equities steady to lower along with the US$ as energies are higher so far this morning. Corn finished the overnight 14 to 16 higher, soybeans 25 to 34 higher and wheat 13 to 17 higher. USDA announced this morning another private sale of 133,000 MT or 4.6 MBU of new crop soybeans for delivery to China. This makes now 8 cargoes of new crop soybeans sold to China or for unknown destinations in the past three trading days.
USDA will update supply and demand this Friday at 11 AM CST. The average trade estimate for corn yield at 175.9 BPA with production at 14.392 BBU compared to USDA in July at 177 BPA and 14.505 BBU. The average trade estimate for soybean yield at 51.1 BPA and production at 4.481 BBU compared to the July USDA estimate at 51.5 BPA and 4.505 BBU.
Temps begin to increase and will get back to excessive heat in the Northern Plains later this week. The NWS 6-10 day forecast still calling for above normal temps for the western 2/3 of the U.S., now below normal for most of the eastern 1/3 with below normal precip from the Southern Plains through the Corn Belt and into the Great Lakes and above normal for the Southwest.
September corn ranging from $6.32 to $5.83 over the past couple weeks and still a gap down to $5.80 ¾ left on the chart. The December contract looks similar, ranging from $6.36 ½ down to $5.87 ½ with a gap to $5.84 ¼. November soybeans up to $14.89 on July 29th down to $13.56 last week with a gap open down to $13.49 ¼. September KC Wheat chopping sideways since early July with support at $8.14 ½ and resistance at $9.15. September Chicago wheat sideways to lower with a new recent low last week at $7.52 and resistance at $8.45. September MPLS wheat also a new recent low last week at $8.64 ¾ with resistance around $9.50.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Tyson Loewen
www.loewenassociates.com matt@loewenassociates.com
785-537-3336
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