Date: May 3rd, 2023
Cattle futures sharply lower yesterday, feeders breaking through nearby support levels, while lean hogs remain steady to higher. Cash fed cattle trade already began to develop at $172 live in TX and KS and $281 dressed in NE which is a $1 to $3 lower than last week. This provided the opportunity for sellers to jump in heavy on the futures yesterday. It also didn’t help that equites were hit hard yesterday as well. Seasonally, May is not a supportive month for cattle futures, but most felt this year would be different as we hit new all-time highs last month and bullish fundamentals are still in place.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 5/1/2023 – Final
This Week: 6,770 Last Week: 8,523 Last Year: 8,762
Compared to last week: Feeder steers steady to 4.00 higher, stocker steers up to 8.00 higher. Feeder heifers 2.00 – 4.00 higher. Steer calves 4.00 – 9.00 higher, with instances 11.00 higher. Heifer calves 2.00 – 3.00 higher except heifer calves over 500 lbs 1.00 – 4.00 lower. Demand moderate to good. Much needed moisture fell across the trade area last week and more is in the forecast late in the week. 7 weight index steers averaged $204 to $216 and 8 weights averaged $192 to $203.
Sioux Falls Regional Cattle Auction – Worthing, SD
Livestock Weighted Average Report for 5/1/2023 – Final
This Week: 2,167 Last Week: 3,496 Last Year: 1,087
Compared to last week: Feeder steers in a light test sold 2.00 to 4.00 lower, with lighter weights selling significantly lower, 750lbs – 800lbs, 850 lbs – 950 lbs steady to 5.00 higher. Feeder heifers steady to 5.00 lower in a light test, except 600 lbs – 650 lbs 6.00 to 7.00 higher. Demand for this eye appealing offering of green cattle was moderate. 7 weight index steers averaged $219 to $223 and 8 weights averaged $198 to $201.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 5/1/2023 – Final
This Week: 8,634 Last Week: 8,426 Last Year: 6,495
Compared to last week feeder steers sold 2.00-4.00 higher. Feeder heifers sold steady. 7 weight index steers averaged $210 to $211 and 8 weights averaged $195 to $200.
Kingsville Livestock Auction – Kingsville, MO
Livestock Weighted Average Report for 5/2/2023 – Final
This Week: 3,943 Last Week: 3,227 Last Year: 2,733
Compared to last week, steers and heifers sold steady, and although some of the extreme top prices seen on the light cattle under 500 lbs last week weren’t quite achieved, all weights sold on an active market with good to very good demand. Dry weather and favorable market conditions made for a large supply of cattle and it sure feels as though we are still in a liquidation phase for this area with big runs of calves, feeders and cows all spring. The grass has been slow to get going, forage reserves have been depleted and hay season feels a long ways away right now.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 5/2/2023 – Final
This Week: 2,700 Last Week: 2,702 Last Year: 1,691
Compared to last week, calves under 600 lbs. sold steady to 5.00 higher, with some spots of 10.00 higher on heifers. Feeders over 600 lbs. had few true comparisons with the previous auction but steady to weaker undertones were noted. The supply of feeders was moderate, the majority of the offering was fairly plain and on the thin side of flesh conditions. It is evident that winter was long in the area and feed is in short supply as hay plies have run out and grass is off to a very slow start due to lack of recent moisture and cool temperatures. Although not the driest area of the state, it sure enough is dry locally.
Cattle slaughter on Tuesday estimated at 127,000 head, down 1,000 from last week but up 1,000 from last year. Hog slaughter estimated at 459,000 head, down 11,000 compared to a week ago and down 22,000 compared to a year ago.
Boxed beef cutout values on Tuesday lower on moderate demand with 125 loads sold.
Choice Cutout__309.24 -.78
Select Cutout__288.66 -2.34
CME Feeder Cattle Index__202.82 +1.01
CME Lean Hog Index__74.35 +2.25
Pork Carcass Cutout __82.08 +1.61
June live cattle breaking through nearby support levels with a gap to fill from $161.92 to $161.07. The contract high was hit April 13th at $166.27 and the all-time spot month high from that same date when April live cattle hit $177.70. May feeders also breaking nearby support, filling the gap this morning with support next at $201.82. The contract high is at $212.77, the next upside target at $216 and the all-time spot high quite a bit further away at $245.20. June lean hogs have support at $88, the contract low from April 21st at $84.62 and resistance at $92.00.
Grains were all lower on Tuesday, again led by collapsing wheat markets. Egypt tendered for wheat and Russian offers came in the lowest at $260/MT or $7.08/BU FOB. The Russian Ag Ministry had previously stated that exporters would not go below $275/MT. This of course very bearish for wheat as world values continues to tank and are sharply discounted to U.S. values. US gulf bids for SRW are at $7.00/BU and HRW at $8.92/BU. Egypt ending up purchasing 655,000 MT or 24 MBU from Russia and Romania. Corn and soybeans also lower yesterday, majority of the pressure on old crop soybeans as Brazil continues to be an aggressive seller of its record new crop.
Grains were mixed overnight with wheat holding gains, some bouncing off new lows while corn also made new lows but remained in the red. The Oklahoma wheat tour reported production estimates at 54.3 MBU for the state. This compares to last year’s drought stressed crop at 68.6 MBU and a good wheat crop year in Oklahoma will typically exceed 100 MBU production. Outside markets mixed as the US$ lower, equites higher and crude down another $2/barrel after falling $4 yesterday and trading under $70 for the first time since late March. Corn finished the overnight 2 to 3 lower, soybeans 2 to 8 lower and wheat 2 to 13 higher.
Weather forecasts still showing scattered rains across the majority of the country towards the end of the week through the middle of next week. The 6-10 day outlook showing above normal temps for the eastern half of the country and below normal out West with above normal precipitation in the Northwest, middle of the country and the Southeast.
July corn down to a new low for the year overnight at $5.69 ¼ with support next at $5.60 and resistance at $6.01. December also a new low at $5.12 ½ with resistance at $5.50. July soybeans down below the $14 level again with the recent low at $13.83 ¾ and resistance at $14.40. The November contract holding support at $12.50 so far, the recent low at $12.47 ½, resistance around $13.00. July KC wheat down to a new low for the year yesterday at $7.36 ¼ with resistance at $8.20. July Chicago wheat down to a new low overnight at $6.03 ¾ with resistance at $6.42. July MPLS wheat hit a new contract low overnight at $7.69 with resistance at $8.42. July soybean meal hitting a new recent low today with support next last week at $419 and resistance at $439.
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.
