Date: August 2, 2023
Cattle futures finished triple digits higher yesterday, although it wasn’t right out of the gates and still seems to be a bit of a delayed response with corn sharply lower the past few trading sessions. Beef prices were sharply higher in the morning report which looked to be the catalyst for the strength in futures which continued into the close. Still only light volume negotiated cash fed cattle trade so far this week in the North at $294 dressed which is steady with last week’s trade. Lean hogs settled with minor losses yet still scored new recent highs and look to test resistance levels from earlier this spring.
Oklahoma National Stockyards Feeder Cattle – Oklahoma City, OK
Livestock Weighted Average Report for 7/31/2023 – Final
This Week: 4,253 Last Week: 6,683 Last Year: 9,112
Compared to last week: Feeder steers steady. Feeder heifers steady to 2.00 higher. Steer calves 2.00-4.00 higher. Heifer calves 3.00-6.00 higher. Demand very good for all classes. Somewhat lighter numbers as high heat continues. Much of the week will be 100 plus degrees. 7 weight index steers averaged $245-$248 and 8 weights averaged $237-$242.
Joplin Regional Stockyards Feeder Cattle – Carthage, MO
Livestock Weighted Average Report for 7/31/2023 – Final
This Week: 3,804 Last Week: 4,808 Last Year: 7,386
Compared to last week feeder steers sold steady to 4.00 higher. Feeder heifers sold steady to 2.00 higher. Supply was light with very good demand. 7 weight index steers averaged $242-$251 and 8 weights averaged $240-$241.
Ozarks Regional Stockyards Feeder Cattle – West Plains, MO
Livestock Weighted Average Report for 8/1/2023 – Final
This Week: 2,390 Last Week: 2,515 Last Year: 2,870
Compared to last week, feeder steers and heifers sold steady while steer and heifer calves sold steady to 5.00 higher, with most of the gain on heifer calves. Demand was good on a light to moderate supply.
Sioux Falls Regional Cattle Auction – Worthing, SD
Livestock Weighted Average Report for 7/31/2023 – Final
This Week: 2,480 Last Week: 2,181 Last Year: 2,694
Compared to last week: Feeder steers 950 lbs – 1050 lbs steady to 3.00 higher, over 1100 lbs 1.00 lower, other weights not well compared. Feeder heifers sold with higher undertones, weights were not well compared. Demand for this eye appealing offering of feeder cattle was good. A couple lots of cattle weaned today and offered for sale due to grass being burnt up. 7 weight index steers averaged $263-$275 and 8 weights averaged $245.
Cattle slaughter on Tuesday estimated at 124,000 head, down 1,000 from last week and matching last year. Hog slaughter on Tuesday estimated at 476,000 head, down 1,000 compared to a week ago but up 4,000 compared to a year ago.
Boxed beef cutout values higher on moderate demand with 102 loads sold.
Choice Cutout +4.32 @ 306.10, Select Cutout +1.87 @ 279.60
CME Feeder Cattle Index @ 244.69, Lean Hog Index @ 105.90
Pork Carcass Cutout -1.95 @ 115.26
August live cattle holding the long-term higher trend yet cautious to test the contract and all-time spot high at $182.97 that was hit on July 20th with support at $176.80 then $175.20. August feeders holding the long-term higher trend with the contract and all-time spot high hit back on July 12th at $251.30. Nearby resistance is at $250 with support at $242. August lean hogs again a new recent high yesterday at $104.95 with resistance at $105.62 and support at $99.95.
Wheat and corn continued lower on Tuesday as soybeans stabilized for the moment. Funds were big buyers of all the grains a week ago but have shifted gears back to heavy selling and are back carrying a net short position in corn. U.S. weather forecasts still improving with better rain chances over this next week across the WCB and below normal temps and above normal precip for the first half of August. Fall crop conditions took a turn lower last week with major declines in most WCB states. Wheat futures were under pressure for the 5th consecutive trading day as less airstrikes were reported in Ukraine and rumors swirling that Russia may now want back in the Black Sea deal. This of course is not news as the only way Putin wants back in is if all sanctions are lifted. This “headline trading” will continue, especially for wheat, as it remains the most volatile in the Ag sector.
USDA released their monthly demand reports yesterday. All wheat ground for flour during the second quarter 2023 was 222 MBU, down 2% from the first quarter 2023 and down 4% from the second quarter last year. Soybeans crushed for crude oil was 175 MBU in June 2023. This compares to 189 MBU in May 2023 and 174 MBU in June 2022. Total corn consumed for alcohol and other uses was 493 MBU in June 2023 which is down slightly from May 2023 and down less than 1% from June 2022. Corn for fuel alcohol was 441 MBU which is up 1% from May 2023 but down 1% from June 2022. The weekly EIA report will be out later this morning with ethanol production expected to be back down 3% after last week’s surprisingly bullish increase.
Grains were mixed overnight with soybeans the leader lower and wheat the leader higher. Fund selling sure is keeping the lid on any rallies. Wheat shot $.20+ higher last night when reports came out that Russia was hitting Ukraine ports again on the Danube River. Last time this happened, wheat shot limit higher and held near the highs during the day. Wheat finished the overnight 5 to 11 higher, corn 3 to 4 higher and soybeans 12 to 17 lower. Outside markets have equities lower, US$ steady to higher and energies mixed with gas and heating oil steady to higher but crude steady to lower.
Hazardous heat to continue in the South this week. Heavy rains today in MO then heading into the Southeast. Parts of the WCB still looking to get some good rains over the next few days but only light and scattered rains expected in the ECB. The 6-10 day outlook showing above normal temps to remain in the South and below normal temps over the Plains and WCB with below normal precip in the Southwest and above normal precip across the majority of the U.S.
September corn breaking through nearby support this morning with the next the July low down at $4.74 and resistance at $5.38 ½. December corn looking to test the $5.00 level again with support at $4.97 then $4.81 and resistance up at $5.36 then $5.72. August soybeans dropping below the July low this morning with support next at $13.51 and resistance at $14.80. November soybeans trying to hold support at $13.15 with resistance at $13.73. September KC wheat breaking through the higher trendline this week with support next at $7.87 and resistance at $8.58. September Chicago wheat has support at $6.37 with resistance at $7.03. September MPLS wheat has support at $8.46 with resistance at $8.95. August meal hit a new contract high last week at $472.50 with support at $446.
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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