Date: April 17th, 2023
Cattle futures finished the week mixed with pressure on the front months for live cattle and deferred feeders as lean hogs actually traded in positive territory last Friday. The pressure for cattle on Friday came from the higher feed grains and lower equity markets. All cattle contracts made new contract highs on Thursday with sharply higher negotiated cash fed cattle trade. Kansas trade was reported from $170 to $178 live, with the majority at $175, up $5 from last week, and the weighted average will be a new all-time high for the state. Even more impressive was the $9 to $12 higher trade reported in Nebraska from $182 to $186 live and $283 to mostly $290 dressed, the weighted average will also be all-time highs.
Weekly closes for livestock…April Live Cattle +$3.68, June +$.62, April Feeders +$2.77, May +$2.50, August +$1.35, April Lean Hogs -$2.40, June -$1.30. Choice Boxed Beef +$11.64 at $302.62 and Pork Carcass Cutout +$.35 at $78.25 (3.87:1 Beef to Pork ratio).
Oklahoma Weekly Cattle Auction Summary
Livestock Weighted Average Report for 4/9/2023 – 4/15/2023
Receipts: Current Week 25,265 Last Reported (4/3) 26,078 Last Year 25,901
Compared to last week: Feeder steers 4.00-8.00 higher. Feeder heifers 4.00-10.00 higher. Steer calves steady to 2.00 higher. Heifer calves 5.00-10.00 higher. Demand very good for all classes. Slaughter cattle prices moving to record levels as fewer market ready cattle numbers come to fruition. Lighter feeder numbers are also the story as feeder prices continue to push higher. Slaughter cow runs have picked up again in the last 2 weeks, as the drought in western Oklahoma continues to get worse.
Cattle slaughter last week estimated at 613,000 head, up 10,000 from the week previous but down 25,000 from last year. Beef production is estimated at 502.8 million pounds with year to date down 4.6% from last year while slaughter is only down 2.9%.
Hog slaughter last week estimated at 2,438,000 head, up 68,000 compared to the week previous and up 92,000 compared to a year ago. Pork production is estimated at 529.1 million pounds
with year to date up 2.1% compared to a year ago with slaughter up 1.6%
Boxed beef cutout values on Friday higher on moderate to weak demand with 80 loads sold.
Choice Cutout__302.62 +2.20
Select Cutout__283.87 +.49
CME Feeder Cattle Index__201.31 +1.54
CME Lean Hog Index__71.63 -.32
Pork Carcass Cutout __78.25 +.69
April live cattle hit a new contract high and all-time spot month high last Thursday at $177.70. April is up over $17 since March 22nd, with 2 gaps on the way up and strong technical support all the way down at $167.50. The contract is now in delivery and will continue to be supported by the sharply higher cash trade the past few weeks. April feeders hit a new contract high last Thursday as well at $204.00. April has rallied nearly $20 in the past 3 months with the next upside target at $205, the all-time spot high quite a bit further away at $245.20 and support down around $197.60. April lean hogs a new contract low on Thursday at $71.50. The contract will expire today and the hope is it will stay above the $70 level as we have not had a spot contract below that level since January 2021. May takes over as the front month starting off with a premium over $8 but very low trading interest in May hogs. June is then next with over a $15 premium to April.
Wheat finished out last week the leader with a sharply higher day on Friday which secured week over week gains. Corn also rallied Friday while soybeans pulled back some but both had gains for the week as well except for the new crop November soybean contract. November tested support again at $12.95 which held as the new crop December corn contract tested $5.50 support last week which held as well. The biggest news of the day was the confirmation of the first Brazilian soybean shipment destinated for the U.S. east coast. This is the first of the marketing year and a bit sooner than normal due to steep discounts on Brazil’s record new crop and near pipeline supplies here in the U.S. Wheat trading remains volatile as the Southern Plains drought continues, spring wheat planted is behind and Russia again threatening to end the safe shipping lane for Ukraine Ag exports through the Black Sea.
The CFTC Commitment of Traders Report for the week ending April 11th showed managed money/funds buying 5,500 corn contracts (net long 27,100), selling 20,900 soybean contracts (net long 125,000), selling 17,100 Chicago wheat contracts (net short 104,200) and buying 1,600 KC wheat contracts (net long 9,200).
Weekly closes for the grains…May Corn +$.22 ¾, December +$.03 ¼, May Soybeans +$.08, November -$.08 ¼, May KC Wheat +$.14 ¼, July +$.17 ¼, May Chicago Wheat +$.07, July +$.04 ½, May MPLS Wheat +$.04 ¼, September +$.00 ½, May Soybean Meal +$5.40/T, December -$.50/T.
Grains mixed overnight and fairly quiet on very little new news. Outside markets have equities mixed, US$ higher and energies lower. Corn finished the overnight steady to 3 higher, soybeans the leader at 3 to 7 higher and wheat 3 to 6 lower for KC and MPLS while Chicago wheat finished 2 to 4 higher.
March NOPA crush will be released later this morning with the average trade estimate for domestic soybean crush at 183.4 million bushels. This compares to 165.41 million bushels in February and 182.465 million bushels in March 2022. Weekly export inspections will also be out this morning then after the markets close, USDA will update crop progress and conditions.
Rains this week expected from the Southeast through most of the Corn Belt up to the Great Lakes as the Southern Plains and Southwest remain dry. The 6-10 day outlook showing below normal temps across the majority of the country with spots of above normal precipitation for the PNW and Southern Plains then from the Southeast up the East Coast and below normal for the northern Corn Belt and Southwest.
May corn testing the recent high at $6.68 again overnight with resistance next up at $6.85 and nearby support at $6.50. December still holding the long-term lower trend with support around $5.50, the recent low last month at $5.47 ½, and resistance at $5.76. May soybeans have nearby support at $14.80 and resistance at $15.27. The November contract has nearby support at $12.95 and resistance around $13.40. May KC wheat tested the short-term higher trend last week before reversing higher with support holding at $8.40 and resistance around the $9 level. May Chicago wheat holding the long-term lower trend with support at $6.54 and resistance at $6.93. May MPLS wheat took out the short-term higher trend last week with resistance at $9.13 and support at $8.47. May soybean meal hit a new contract high back on March 7th at $498, down to a new recent low on March 24th at $435, with nearby resistance at $470.
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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