[Mon]: Scott Shellady said on Friday that there just wasn’t enough to get the bulls involved at the end of last week’s cattle trade… [Fri]: Choice fell $1.98… Select dropped $1.72… In negotiated cash sales in Nebraska, the USDA reported 6,364 head sold live at $120-122.50, with 12,845 head sold dressed at $193-195.25. In Iowa-Minnesota, 9,432 head sold live at $119-124, while 9,226 head sold dressed at $193-195. With higher marketings possibly coming, that could also cause a weaker beef price, The Hightower Report said. “If beef market breaks, traders will then look for lower cash trade next week”…
Farm Commodity Newsletter/Iowa Farmer Today
Mon 1/7/2019 9:12 AM
Cattle - Scott Shellady said on Friday that there just wasn’t enough to get the bulls involved at the end of last week’s cattle trade. “If you take a step back and look at the chart, from the 2015 highs and the 2016 lows we’ve had, … we are right in the middle.”
He also added that volatility is increasing as the government market involvement retreats. “We had 8 years of an unprecedented low-volatility period, and that’s because we had the Federal Reserve back in the market,” he said. “That trickled down through everything we trade. That’s been pulled away here a little bit.”
China cracking down on ASF reporting
After concerns the extent of African swine fever was being under-reported in China, the country has warned their pork industry “that covering up cases of (ASF) is a crime,” Allendale said. This comes after a dead pig was found dead on a Taiwanese beach, “prompting Taipei to claim Beijing was not sharing accurate information.”
Cattle fell hard to end the week last week, as “we knew there was some weather premium baked into the market,” Blue Line Futures said.
Fri 1/4/2019 4:28 PM
Boxed beef cutout values this afternoon were lower on light to moderate demand and heavy offerings, USDA said.
• Choice fell $1.98 to $214.51/cwt. (week ago: $214.41)
• Select dropped $1.72 to $207.72. (week ago: $207.24)
In negotiated cash sales in Nebraska, the USDA reported 6,364 head sold live at $120-122.50, with 12,845 head sold dressed at $193-195.25. In Iowa-Minnesota, 9,432 head sold live at $119-124, while 9,226 head sold dressed at $193-195.
With higher marketings possibly coming, that could also cause a weaker beef price, The Hightower Report said. “If beef market breaks, traders will then look for lower cash trade next week.”
“With the lower beef prices, packer margins should be shrinking, and this will likely lead to lower cash trade,” Stewart-Peterson said. They said there’s some more room for downside after March made its lowest close since December 7, making its largest weekly losses since the first week of November.
Cattle suffers 'significant technical damage'
After February cattle opened higher today, they traded sharply lower doing “significant technical damage,” The Hightower Report said. The market hit its lowest level since Dec. 20, and the dry 7-day forecast in the plains may have caused a weaker beef price.
This week, the estimated slaughter for hogs came in at 1.835 mln head, up almost 400,000 from last week, and up 78,000 from this time last year.
Cattle slaughter was estimated at 428,000 head, rising 64,000 head from last week. However, that number is down 33,000 head from this period last year.
WASDE delayed due to shutdown
The January WASDE report has been delayed “until further notice,” Michael Headlee of CHS Hedging said. The expectation is traders will learn the report’s release date after the partial government shutdown is resolved.
In the latest update from the Government shutdown, Democratic senator Chuck Schumer said President Trump threatened to “keep the government closed for a very long period of time, months or even years,” Reuters reported
There was “really nice trade to see corn come back after last week,” Chris Dudics of The Andersons said. He said there was good technical action this week.
Ethanol: The weekly Ethanol report showed a decrease of 31,000 barrels in production to 1.011 mln barrels per day. Stocks, however, were up 100,000 barrels to 23.2 mln barrels. Michael Headlee of CHS Hedging said ethanol margins continued improvements but stay negative.
“Storing beans has paid off, but let’s not get too greedy,” Chris Dudics, representative of The Andersons said. He noted that with the government shutdown being uncertain, without final production it will be tough to gauge and the market could be volatile.
The continued dry weather in Brazil has some private estimators “downgrading the Brazilian crop anywhere from 105-115 mmt,” Stewart-Peterson said. That number is down from the 120-122 mmt figure traders have been working with. “While nothing is guaranteed, it looks likely that the highest production estimate for the year is already behind the market.”
Wheat is gaining support from high corn and soybean prices, including a lack of snow cover on much of the planted winter wheat. “While the near-term forecasts look non-threatening, one significant cold snap could create major concerns,” Stewart-Peterson said.
Wheat went higher on “technical buying and lowered estimates of wheat seedings,” Michael Headlee of CHS Hedging said. Informa placed U.S. winter wheat seedings at 31.513 mln acres, which is down 1.022 mln from last year.