Date: January 17th, 2023
Livestock futures last Friday finished mixed as well as for the week. Live cattle were able to hold small gains week over week, but both feeders and lean hogs were lower with pressure coming from higher corn prices. Cash fed cattle trade volume was light again last week and steady to $2 lower than the week previous. Live trade in KS and TX at $156 with trade in the North from $156 to $158 live and $250 to $255 on a dressed basis. Supplies will continue to get tighter as weights have already been reported lower to begin the New Year. Packer margins are still very good and should continue to keep chainspeeds near max capacity.
For the week, Friday January 6th through Friday January 13th, February Live Cattle +$.95, April +$.22, January Feeder Cattle -$1.45, March -$2.77, February Lean Hogs -$1.62, April -$2.37. Boxed Beef, Choice -$6.37 @ $276.62, Select -$2.45 @ $256.89, Pork Carcass Cutout -$2.36 @ $81.64.
Oklahoma Weekly Cattle Auction Summary
Livestock Weighted Average Report for 1/8/2023 – 1/14/2023
Current Week: 58,292 Last Report 1/2/23: 21,610 Last Year: 47,571
Compared to last week: Feeder steers steady to 4.00 lower, most decline under 750 lbs. Steer calves 3.00-5.00 lower. Feeder heifers and heifer calves sold mostly steady. Large run of cattle at all reported auctions this week as dry weather continues and not many chances of moisture in the extended forecast. Demand moderate. Lighter weight cattle are seeing limited outlets as much of the wheat pasture has not had enough moisture for growth and enough growth to sustain cattle.
Cattle slaughter last week estimated at 661,000 head, up 98,000 from the week previous and up 43,000 from last year. Year to date slaughter though still down 3.9% compared to the first few weeks of 2022. Monday’s cattle slaughter estimated at 125,000 head, down 4,000 from last week but up 15,000 from last year.
Hog slaughter last week estimated at 2,688,000 head, up 392,000 compared to the week previous and up 321,000 compared to a year ago. Year to date slaughter also behind a year ago by 2.7%. Monday’s hog slaughter estimated at 424,000 head, down 61,000 compared to last week but up 31,000 compared to a year ago.
Boxed beef cutout values on Monday higher on Choice but lower on Select on moderate demand with 91 loads sold.
Choice Cutout__277.43 +.81
Select Cutout__256.55 -.34
CME Feeder Cattle Index__182.03 -.33 from Thursday 1/12
CME Lean Hog Index__74.34 -.49 from Friday 1/13
Pork Carcass Cutout __81.64 +2.31 from Friday 1/13
Chinese year end data released this morning with 2022 pork production at 55.41 MMT, up 4.6% from 2021 and the highest level since 2014. For comparison, 55.41 MMT equals 122.16 billion pounds of pork while the U.S. produced just over 27 billion pounds of pork last year.
February live cattle holding the long-term higher trend with the contract high at $159.17 back on December 29th and support at $156.50. January feeders also trending higher since October with roughly a $5 trading range since early December from $180 to $185. This range should hold until the contract expires on January 26th as it will be closely tied the CME Cash Index. February lean hogs continue to be under heavy pressure with a new recent low last week at $77.57, support next at the one-year low at $76.40 and nearby resistance around $86.
Spillover friendly crop report support on Friday for the grains which helped secure weekly gains. Argentina forecasts did improve some heading into the weekend, but multiple private estimates made drastically higher cuts to both corn and soybean production estimates compared to USDA’s modest cuts on Thursday. Brazil actually a little too wet as early soybean harvest begins. U.S. producer selling has picked up as we entered the New Year which has put some pressure on nearby basis levels yet differed bids are still holding steady as coverage may only be 30-90 days out. Wheat still a follower and without support from corn would have no issues continuing lower. Winter wheat planted acres in the U.S. reported at an 8-year high and Australia’s record crop will soon hit the export market taking away one of our best markets in SE Asia.
For the week, Friday January 6th through Friday January 13th, March Corn +$.21, May +$.19 ¾, March Soybeans +$.35 ¼, May +$.28 ¾, March KC Wheat +$.11 ¾, July +$.11 ¼, March Chicago Wheat +$.00 ¼, July -$.02 ½, March MPLS Wheat +$.10 ½, May +$.10 ¼, March Soybean Meal -$1.30/T, May +$1.50/T.
Grains under pressure overnight. Long range, 2-week out forecasts showing improved rain chances for Argentina. Not sure if that’s enough 5-10 lower corn and beans though. Wheat actually the leader lower finishing the overnight 10 to 13 lower. EU Matif milling wheat down over 2% since last Friday. Equites lower this morning, US$ steady and energies higher. China reported only 3% GDP growth in 2022, the 2nd slowest year since 1976. USDA reported a couple export sales this morning…119,000 MT or 4.4 MBU of soybeans for unknown destinations and 150,000 MT or 5.9 MBU of corn for delivery to Colombia.
U.S. weather this week highlighted by the winter storm from Eastern CO up into the Great Lakes then heavy rains again for the Southeast later this week. The 6-10 day outlook showing below normal temps for the western half of the country and above normal on the East Coast with above normal precipitation across the entire country except for below normal on the West Coast.
March corn still rangebound since mid-August with nearby support at $6.48 and resistance at $6.85. March soybeans holding the long-term higher trend with a new recent high back on December 30th at $15.37 ½, the contract high from June at $15.72 ¼ and support at $14.65. March KC wheat holding a lower trend since mid-October with a new recent low last week at $8.03 ¼ and resistance at $8.47. March Chicago wheat also holding a lower trend with a new recent low last week at $7.20 ½ and resistance at $7.58. March Mpls wheat has support at $8.90 and resistance at $9.40. March soybean meal hit a new contract high again last Friday at $485.30 with the spot highs from August the next upside target at $531.20. Meal gapped lower overnight though with nearby support down around $460.
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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