Date: December 8, 2023
In the cattle complex, we started the day higher in a lot of contract months, rallied decently and then the sell pressure hit, taking some of the deferred feeders down more than $2 and a few live cattle contracts down over $1. Negotiated cash fed cattle trade this week in the Southern Plains has been parked at $171 live, which is $8 to $9 above futures, meaning crazy positive basis. That’s a very good thing for hedgers, but the collapsing futures markets overall still a very bade thing for everyone else. Dressed trade in the North this week from $267 to $271, $3 to $5 lower than last week.
Winter Livestock – Dodge City, KS
Livestock Weighted Average Report for 12/6/2023 – Final
This Week: 3,630 Last Week: 1,287 Last Year: 4,411
Compared to last week on limited comparisons, steers sold 4.00 to 8.00 lower. Heifers sold 5.00 to 10.00 lower. 7 weight index steers averaged $219 and 8 weights averaged $210.
OKC West Livestock Auction – El Reno, OK
Livestock Weighted Average Report for 12/6/2023 – Final
This Week: 8,296 Last Week: 7,326 Last Year: 10,427
Compared to last week: Feeder steers sold 4.00-12.00 lower. Feeder heifers traded 1.00-3.00 lower. Steer and heifer calves sold mostly 5.00-10.00 lower. 7 weight index steers averaged $223 and 8 weights averaged $210 to $214.
Hub City Livestock Auction – Aberdeen, SD
Livestock Weighted Average Report for 12/6/2023 – Final
This Week: 4,370 Last Week: 4,777 Last Year: 4,864
Compared to Last Wednesday: steer calves 450 to 499 lbs and 600 to 649 lbs 3.00 to 4.00 lower, 500 to 599 lbs steady to 4.00 higher. Yearling steers not well compared. Heifer calves 450 to 499 lbs mostly steady, 500 to 599 lbs 5.00 to 8.00 lower. Best test on yearling heifers 900 to 949 lbs 2.00 to 3.00 lower. Moderate to good demand for yearlings, mostly moderate demand for calves.
Cattle slaughter on Thursday estimated at 126,000 head, up 5,000 from last week and matching last year. Week to date now estimated at 502,000 head, up 8,000 from last week but down 2,000 from last year.
Hog slaughter on Thursday estimated at 488,000 head, up 2,000 compared to a week ago but down 6,000 compared to a year ago. Week to date estimated at 1,946,000 head, up 16,000 compared to a week ago but down 10,000 compared to a year ago.
Boxed beef cutout values lower on Thursday on very good demand with 218 loads sold.
Choice Cutout -.72 @ 289.84, Select Cutout -1.07 @ 258.83
CME Feeder Cattle Index @ 222.31, Lean Hog Index @ 69.12
Pork Carcass Cutout +.17 @ 83.37
December live cattle down to a new low for the year yesterday at $162.20 with support next at $161.20 then the contract low at $153.32 and nearby resistance at $169.50. January feeders hit a new contract low on Monday at $209.15, which has held so far this week, with resistance at $215.60 then $223.57. March forward though hit new contract lows again yesterday. December lean hogs holding a lower trend with a new recent low yesterday at $66.72, the contract low from October at $65.40 and nearby resistance at $69.40.
A mixed start yesterday for the grains turned into a nice rally into the close. Soybeans and some of the wheat contracts were up over a dime, everything else held single digit gains. The nearby January soybean contract posted a key reversal higher yesterday. The weather forecast in Brazil turned drier in the central and northern areas. Brazil’s CONAB also updated production estimates yesterday dropping total corn production ½ MMT to 118.5, wheat production 1.5 MMT to 8.14 MMT and soybean production down 2.2 MMT to 160.18 MMT. Good string of 8am flash sales in wheat and soybeans this week, along with solid export sales in the weekly report helping provide support.
Later this morning we get the December S&D report out from USDA. Expectations on ending stocks are looking for no change to wheat from the November report, a mild reduction in stocks in soybeans and a mild increase in corn. Dec reports are generally sleepers, but as always, if there’s any big deviations from these trade guesses, there’s still firework potential. The other influential numbers will be South American production, specifically if USDA will decrease estimates in Brazil.
Grains traded both sides of unchanged overnight and finished mixed with soybeans the leader higher again. Corn finished the overnight 1 higher, soybeans 7 to 11 higher and wheat 1 to 4 lower. Outside markets have equities lower, US$ higher and energies higher with crude oil up $1.40/barrel after breaking below the $70 level for the first time since July.
More USDA flash export sales this morning with 165,000 MT or 6.5 MBU of corn for delivery to unknown destinations, 136,000 MT or 5 MBU of soybeans to China and 110,000 MT or 4 MBU of SRW also for delivery to China.
Heavy precip over the weekend expected in the PNW and on the East Coast with chances over the Southern Plains towards the end of next week. The 6-10 day outlook showing above normal temps from the West Coast to the Great Lakes with normal temps for the rest of the country and above normal precip in the Southwest and in Florida with below normal precip from the Mountain West to the Northeast.
March corn contract low on November 29th at $4.70 ½ as the now in delivery December corn hit a new 2-year low at $4.47. March tested resistance this week with a high so far at $4.93 ¾ and a test of the $5 level could lead to a test of the October high at $5.21 ½. January soybeans down to a new recent low yesterday at $12.92 then reversing higher with resistance at $13.52. March Chicago wheat hit a new contract low on November 27th at $5.56 ¼ and has rallied over $.90 since with nearby support at $6.00 and resistance next at $6.70. March KC wheat a new contract low on November 28th at $5.95, rallied over $.80 since with support at $6.40 and resistance at $6.99. March MPLS wheat contract low on November 27th at $6.97 ½, only a $.50 rally since with resistance at $7.54. January soybean meal up to a new contract high on November 15th at $460.6 but breaking nearby support this week for a new recent low at $402.40.
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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