Date: June 12th, 2023
Live cattle and lean hog futures a bit calmer to end the week while feeders again traded a wide daily range. New highs for both fats and feeders mid last week, but a technical selloff then battled friendly fundamentals the balance of the week. Negotiated cash fed cattle trade volume picked up first in the North from $188 to $194 live, $2 to $7 higher vs. last week, and $298 to $302 dressed, $8 to $12 higher. TX and KS trade reported mostly at $185 live, $5 higher than last week with the full range for the week from $184 to $188. The WASDE monthly supply and demand report increased beef production estimates both for this year and next with sharply higher pork exports for the next two years while leaving production unchanged.
Weekly closes for livestock futures and meats…June Live Cattle +$1.80, August -$1.05, August Feeders -$2.90, September -$3.30, June Lean Hogs +$1.15, July +$4.97. Choice Boxed Beef +$23.00 at $332.93 and Pork Carcass Cutout +$3.67 at $88.39.
Oklahoma Weekly Cattle Auction Summary
Livestock Weighted Average Report for 6/4/2023 – 6/10/2023
Receipts: Current Week 32,918 Last Week 12,490 Last Year 28,336
Compared to last week: Feeder steers 10.00-15.00 higher. Feeder heifers 8.00-12.00 higher. Demand very good for feeder cattle post holiday. Steer and heifer calves sold mostly steady. Demand remains good for calves as recent moisture has improved the drought situation greatly.
Cattle slaughter last week estimated at 621,000 head, up 48,000 from the week previous but down 50,000 from last year. Beef production last week estimated at 505 million pounds with year to date now -4.8% vs. last year and slaughter -3.5%.
Hog slaughter last week estimated at 2,363,000 head, up 335,000 compared to the week previous but down 3,000 compared to a year ago. Pork production estimated at 506.5 million pounds last week with year to date only +0.5% compared to a year ago and slaughter +1.3%
Boxed beef cutout values on Friday continued higher on moderate demand with 81 loads sold.
Choice Cutout__332.93 +4.20
Select Cutout__305.71 +1.61
CME Feeder Cattle Index__226.18 +3.98
CME Lean Hog Index__83.30 +.51
Pork Carcass Cutout __88.39 +2.71
June live cattle hit a new contract and all-time spot high last Wednesday at $182.87 before reversing lower with support at $175. The contract is in the delivery but still holding a step discount to the current cash trade, meaning a strong positive basis, which is great for those hedged and should mitigate any chance of delivery. August feeders also hit a new contract high on Wednesday at $245.17, 1 tick shy of matching the all-time spot high hit back in October 2014. Nearby support is at $239.35 with the next down at $235. June lean hogs with a decent recovering since making a new contract low back on May 26th at $75.45. Resistance at $88.52 then at $92 with nearby support at $83.85.
A very mixed bag for the grains on Friday and for the week. Soybeans rallied on Friday to preserve week over week gains while corn and wheat suffered losses. The USDA crop report only increased the winter wheat production estimate by 6 MBU to now 1.136 BBU, only half of what was expected. World production though increased by 10+ MMT and most of that in the EU and Black Sea shippers. Both new crop corn and soybean yields were left unchanged as expected and old crop corn and soybean ending stocks higher from USDA decreasing the export totals. USDA also cut Argentina’s corn and soybean production again this month while increasing Brazil’s.
Weekly closes in the grains… July Corn -$.04 ¾, December -$.10 ¾, July Soybeans +$.34, August +$.33 ½, November +$.20 ½, July KC Wheat -$.14 ½, September -$.13 ½, July Chicago Wheat +$.11 ¼, September +$.09 ½, July MPLS Wheat +$.04, September +$.06 ¾, July Soybean Meal -$0.6/T, December -$1.1/T.
Grains steady to higher overnight with corn the leader and the new crop December contract gapping higher. Rains were very spotty over the weekend and lighter than expected in many parts of the ECB. This along with a dry forecast across most of the Midwest and temps increasing supporting the grains to start this week. Outside markets have equities higher, US$ steady and energies lower with crude down over $2/barrel. Corn finished the overnight 8 to 11 higher, soybeans 2 to 6 higher, and wheat 3 lower to 2 higher.
Other news is light this morning. Export inspections will be out later this morning and then updated crop progress and conditions later this afternoon. I would expect to see corn crop conditions lower again across the Corn Belt and HRW harvest delayed some with recent rains in CO, OK and KS.
Rains overnight and continue today in CO, KS and OK with heavy rains expected in the Southeast and 1” rains from OH up into New England. Later in the week and heading into the weekend is the next chance for scattered showers across the Corn Belt. The 6-10 and 8-14 day outlooks showing above normal temps from the Gulf up into the Corn Belt with below normal out West and above normal moisture for the western half of the U.S. and the Southeast.
July corn hitting a new recent high overnight at $6.17 ½ with resistance up at $6.40 and support around $5.80. December again gapped higher overnight but still has resistance at $5.48, last week’s high and support at $5.20. July soybeans also up to a new recent high at $13.92 ¾ overnight with resistance next at $14.11 and support around $13.40. The November soybean also gapped higher on last night’s open, but filled the gap overnight with resistance next around $12.50 and support at $11.67. July KC wheat still very choppy with support at $7.82 and resistance at $8.49 ½. July Chicago wheat still holding the long-term lower trend with support at $6.11 and resistance at $6.64. July MPLS wheat also still showing a long term lower trend with support at $7.75 and resistance at $8.38. July soybean meal trending lower the past few months with support at $396 and resistance at $408.
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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