Date: December 29th, 2022
Livestock futures mixed yesterday as low volume holiday trading takes hold and little new news. As of the close, no cash fed cattle trade yet this week, no bids yet either as this this week’s volume will be lighter than a normal week’s run just like last week. Early asking prices started at $158+ live. After the close, light volume was reported at steady to $1 higher than last week at $158 live and $248 dressed. Beef prices held steady which remains supportive. Feeders were able to hold small gains yesterday even in the face of higher corn prices. Lean hogs were mixed to lower with both pork prices and cash lower.
Cattle slaughter on Wednesday estimated at 128,000 head, up 6,000 from last week and up 10,000 from last year. Hog slaughter on Wednesday estimated at 490,000 head, up 40,000 compared to a week ago and up 17,000 compared to a year ago but Tuesday was revised 8,000 lower to 482,000 head.
Boxed beef cutout values on Wednesday steady to lower on Choice but higher on Select on moderate demand with 102 loads sold.
Choice Cutout__297.41 -.63
Select Cutout__247.28 +1.64
CME Feeder Cattle Index__176.80 +1.07
CME Lean Hog Index__80.69 +1.09
Pork Carcass Cutout __88.67 -2.25
Weighted Avg Cash __76.00 -1.80
December live cattle another new contract high yesterday at $157.50, the highest spot price since April 2015. The contract expires tomorrow and February will take over as the nearby contract. February live cattle hit a new contract high on Tuesday at $158.42 with support around $156 and resistance next around $164 from the continuous chart. January feeders also trending higher but still unable to break through the resistance around $185 with support down last week’s low at $181.25. February lean hogs looking to test the resistance just shy of $92 with support around $87.
Grains once again led higher led by the soybeans. Beans did not test Tuesday’s highs but gains held up much better than the previous day. The weather forecast for Argentina certainly the most influential market mover recently. Tuesday’s markets rallied on disappointing rains over the holiday weekend but came off their highs when better rain chances entered the mix. Yesterday’s market extended gains as the potential for heavy rains across drought stricken areas seem less likely. As of a week ago, Argentina still had 40% of anticipated soybean acres to plant and 45% of anticipated corn acres, but the ideal planting time frame has passed. Sharply higher meal also supportive to beans yesterday. The other friendly news continues to be rumblings that China is easing COVID restrictions.
Corn hit new recent highs and wheat held small gains. KC wheat the closest now out of the three wheat markets to test the long-term lower trend lines as corn futures took it out last week and look a bit more friendly on the charts. Egypt ended up buying 5 cargoes of Russian wheat, not just 2 as first reported. This past week, many ship insurers are now cancelling coverage around the Black Sea. This could present problems with wheat shipped out of the area but could also lead to increased world values and just maybe some additional export volume from the U.S.
Grains were mixed overnight but mostly lower. Equites again higher this morning, US$ and crude lower. Corn finished the overnight 1 lower, soybeans steady to 1 higher, and wheat 9 to 12 lower.
News again light overnight as we wrap up this year. Russian wheat exports up to 24 MMT for the first half of this marketing year compared to 21.6 MMT a year ago. Rosario grain exchange cutting Argentine wheat exports estimate to 6 MMT compared to 15.3 MMT last year. U.S. weekly export sales report delayed until Friday this week.
Heavy rains in the forecast for the Southeast through mid-next week along with heavy snow for the Northern Plains. The 6-10 day outlook still showing above normal temps across the eastern half of the country with above normal precipitation forecasted across the entire country except for a small pocket of below normal now in the Southwest.
March corn breaking the lower trend and now holding a short-term higher trend with a new recent high yesterday at $6.83 ½, resistance next at $6.90 and support at $6.60. January soybeans holding the long-term higher trend with a new recent high on Tuesday at $15.16 ¾, resistance next at $15.60 and support at the 20-day moving average now at $14.72. March KC wheat testing the lower trendline again this week with resistance at $8.95 and support at $8.58. March Chicago wheat has resistance at $8.00 with support at $7.57. March MPLS wheat has resistance at $9.45 with support at $9.17. January Soybean Meal a new contract high on December 9th at $474.4, the spot high from August at $531.2 and nearby support at $446.
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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