Last week was full of sharp and sudden losses across the cattle complex. Markets had calmed down somewhat by the end of the week probably catching some support from the cash side of the equation. Some market pullback was most definitely in the back of my mind, and it should be expected when the cattle markets went up nearly continuously for a month straight. Like I said, it is important to wade with caution during those high times of the market.
Yesterday was a fairly flat day in the cattle complex. Fats opened slightly higher, didn’t test much of red territory and finished all on the plus side. Feeders were a bit more uncertain as they traded an even range on both sides of the unchanged mark, finishing mixed on the day. Market fundamentals are still a big bull in terms of herd size, live imports shut down at our southern border, cash cattle trade and what was becoming a large concern of the northern plains was lack of rain and terrible grass conditions. Hopefully those conditions are improving this week.
National feeder and stocker cattle summary for the week ending May 17- Compared to last week, steers and heifers sold steady to 5.00 higher. Demand was mostly good to very good early week and still remained good later in the week even though futures took a tumble. The CME Cattle Complex took a sharp downturn mid-week after a sharp upturn on Monday. This pullback comes after weeks of strong gains fueled by tight supply and very good demand. It seems that fundamentals are ruling the day in the fed cattle sector as the nearby Live cattle contract was 18.00 under the cash. Something will have to give in the coming few weeks. The market watcher felt like they had been whipsawed last week from one extreme to the other. Cattle producers are feeling very optimistic about the market for the remainder of the year and want to make sure they have cattle in their pens.
Cattle slg.__ was 115K, +16k compared to wa, -3k compared to ya.
Choice Beef Cutout__354.81 +2.32.
Select Cutout__344.11 +1.72.
CME Feeder Cattle Index: $298.86 -1.93
Hog slg.__ was 480K, +14k compared to a wa, +1k compared to ya.
Lean Index. 91.46 +0.20__ Pork cutout___ 101.09 +0.97
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In the grain and oilseed trade, not a whole lot of influential news flow compared to the weekend prior. Trump did speak with Putin yesterday in hopes of promoting some ceasefire negotiations between Putin and Zelensky. Some dry spots in the US received welcoming rains towards the end of last week, and aside from the severe stuff, Kansas has gotten some good rain recently as well. Yet somehow the wheat markets were stronger yesterday… Some regions in Argentina have become concerned with excess moisture and significant losses as they are in harvest season. Corn traded mostly higher with December actually bouncing off of Friday’s recent low support. Soybeans had two sided trade and seemed to be dragging their feet on following the other grains to the upside.
Weekly export inspections report for the week ending May 15- Corn inspections for the week were fantastic, soybeans and milo were light, and wheat was higher than expected but not enough as we approach the end of that marketing year. Corn shipments totaled 67.7 MBU compared to 51.2 the week prior. MYTD well ahead of LY by 405 MBU. Soybean shipments came in at just 8 MBU compared to 16.2 M the week prior. MYTD remains ahead of last year’s pace by 162 MBU still. Milo shipments were 1.5 MBU, finally some volume, but still well behind LY and the export target. Wheat inspections were 15.6 MBU compared to 14.9 M. The past two weeks needed to exceed 20-25 MBU to hit the target but that hasn’t kept up. USDA’s wheat export target of 820 MBU is still 59 MBU away from the current total with two weeks remaining in the wheat marketing year. Top destinations was Japan for wheat, and Mexico for corn, milo and soybeans.
Yesterday’s crop progress report showed corn plantings progressing 16% now at 78% complete. 11% ahead of LY and 5% ahead of 5 yr avg. Corn emerged at 50%, 12% ahead of LY and 10 points ahead of the 5 yr avg. Soybean plantings now 66% complete, 16 points ahead of LY and 13% ahead of the avg. Beans emerged now at 34%, up 11% from the avg. Milo plantings at 33% moving slowly. 2% ahead of LY and the avg. Winter wheat headed is now at 64%, 3 points behind LY but 6% ahead of the avg. Winter wheat conditions declined by 2% in the GE category now at 52% GE and 18% rated PVP which was left unchanged. Spring wheat is now 82% planted and 45% emerged, both ahead of LY and the 5 yr avg.
Overnight trade in the grains had the wheat complex leading higher up 8-11 cents in KC and Chicago, corn up 5-6 and beans still trailing behind, but up 1-3 cents.
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