Date: March 1st, 2023
Livestock futures all trading higher yesterday except deferred lean hogs. Overall, feeders scored the best gains as corn closed lower for the 5th consecutive day. April forward feeder contracts all scored new contract highs. Cash fed cattle trade still holding off for now, I wouldn’t expect to see much volume until Thursday or Friday again this week. IA early week trade reported at $165 live, $1 higher than last week and offers in the South starting at $166, $2 higher than the majority of last week’s trade.
Kingsville Livestock Auction – Kingsville, MO
Livestock Weighted Average Report for 2/28/2023 – Final
This Week: 2,177 Last Week: 2,624 Last Year: 2,306
Compared to last week, feeder steers under 650 lbs sold on a light with a steady undertone, while those over 650 lbs sold steady to 4.00 higher. Feeder heifers under 500 lbs sold on a light test with a higher undertone; 500 to 700 lbs 7.00 to 9.00 lower; over 700 lbs 2.00 to 5.00 higher. Demand was moderate for feeder cattle, with good demand for several loads of yearlings of attractive quality. 7 weight index steers averaged $188 and 8 weights averaged $183.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 2/28/2023 – Final
This Week: 2,517 Last Week: 3,929 Last Year: 3,447
Compared to last week, feeder steers and heifers traded 2.00-4.00 higher. Steer calves traded 7.00-14.00 higher and heifer calves traded steady to 4.00 higher. Demand was very good on a light to moderate supply.
Philip Livestock Auction – Philip, SD
Livestock Weighted Average Report for 2/28/2023 – Final
This Week: 2,679 Last Week: 2,627 Last Year: 1,874
The last reported Feeder Cattle Sale was three weeks ago, therefore no market trend may be determined. Very good demand for Several Load Lots and Many Part Loads and Packages which all sold on a Very Strong, Active Market, especially for Replacement Heifers and Feeder Cattle suitable for grass. 7 weight index steers averaged $190-$195 and 8 weights averaged $192.50.
Cattle slaughter on Tuesday estimated at 126,000 head, down 1,000 from last week and from last year. Hog slaughter on Tuesday estimated at 485,000 head, up 6,000 compared to a week ago and compared to a year ago.
Boxed beef cutout values were steady to higher on moderate demand with 98 loads sold.
Choice Cutout__288.95 +.61
Select Cutout__279.25 +.00
CME Feeder Cattle Index__182.62 +.38
CME Lean Hog Index__78.51 +.29
Pork Carcass Cutout __84.36 -1.58
February live cattle again expired yesterday at $167.50, a new contract high. April is now the front month with the contract high last Friday at $166.40 and support down around $164. October 2014 was the all-time spot high for live cattle at $171.97. March feeders hit another new recent high yesterday at $190.20 and support down at $185.50. The contract high is the next upside target at $192.62. Again, all contract April forward hit new contract highs. April lean hogs remain very choppy, currently in the middle of the range traded over this past month from $81.27 to last week’s recent high at $89.87.
Grains were under heavy selling pressure again yesterday, 5 consecutive lower settlements for corn and soybeans and 6 days in a row for wheat futures. Spring insurance prices set now and even with the recent crash they are still the 2nd highest in history for both corn and soybeans at $5.91 and $13.76 respectively. The soy complex was the leader lower yesterday as it took the reins from the wheat markets, breaking through nearby support and taking out the long-term higher trends. Funds were aggressive sellers on heavy volume as we closed out another month. Argentina weather forecast still looks dry and Brazil soybean harvest still behind normal pace by 5-10% which also delays the second crop corn planting. Hopefully we can spur some export demand with the recent price break, specifically some corn sales. It was reported late yesterday that the Biden administration is expected to recommend the approval of higher ethanol blend, E-15 for certain Midwest sates year-round beginning in the summer of 2024.
Grains stabilizing overnight as yesterday’s new recent lows are holding so far for soybeans but corn and all three wheat markets did dip down for new recent lows again last night. Outside markets show equities, US$ and energies lower with crude down $.60/barrel. Corn finished the overnight steady to 2 lower, soybeans 5 to 7 higher and wheat mixed.
Forecasts for Argentina still showing below normal precipitation, some stray showers possible, as private estimates continue to reduce both their corn and soybean production estimates. India now entering the weather chatter as well with record high temps in February and forecasts that are hot and dry over the next couple weeks. India is the world’s 2nd largest wheat producer and consumer behind China. Last year’s record production allowed for India to enter the export market helping some of the displaced Black Sea origins. Any further reductions in this year’s crop though would flip India to a become a major importer.
Much below normal temps continue this week out West with another round of storms bringing mixed precip for the Plains later this week and heavy rains for the Southeast and ECB. The 6–10-day outlook showing above normal temps for the South and below normal for the Northeast and Northwest with above normal precipitation across most of the country except for a small pocket of below normal moisture for the Northeast.
March grains are now in delivery and have no daily trading limits with volume getting thin. May corn has support right around $6.30 with resistance at $6.67 then around $6.85. December has been trending lower since October with a new recent low overnight at $5.67 ½, support at $5.64 and resistance at $5.98. May soybeans down to a new recent low yesterday at $14.77 ¾, just above the 100-day moving average, coming off a new recent high just last week at $15.49 ¾. The November contract is holding up better with yesterday’s low at $13.45, support down at $13.30 from late January and resistance up at $14.02. May KC wheat needs to hold the $8.00 support level or the next downside target is around $7.40 with resistance just above the $9 level. May Chicago wheat hit a new recent low yesterday at $7.02 ½, also an important support area as the contract has not been below $7 since September 2021. May MPLS down to $8.63 yesterday, the contract low at $8.42 ¼ and resistance at $9.28. May soybean meal hit a new contract high on February 13th at $488.60, March peaked at $508.20 the same day, the spot high from August the next upside target at $531.20 with support at $465.
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Tyson Loewen
www.loewenassociates.com matt@loewenassociates.com
785-537-3336
IMPORTANT—PLEASE NOTE
This does constitute a solicitation to buy or sell commodities futures and/or options. The information contained herein is provided for informational purposes only. The information is not guaranteed as to its accuracy or completeness, although the information was taken from sources we believe to be reliable. The market recommendations of Loewen and Associates, Inc. are based solely on the judgment of Loewen and Associates, Inc. personnel. We do not guarantee or warranty, either expressed or implied, of success to you in the use of this information. Loewen and Associates, Inc. disclaims responsibility for or loss associated with use of information from our commentary, analysis or recommendations. There is risk of loss in trading commodity futures and options. The risk in trading can be substantial; therefore only genuine “risk” funds should be used.