[Weds]: With the uptick in Chinese pork values, the possible increase in import activity should “begin to support pork values globally,” The Hightower Report said… [Tues]: National carcass base was up $2.42… Iowa-Minnesota carcass base rose $1.53… USDA reported carcass cutout values this afternoon rose $1.20… Increasing pork values provided support for hog markets. “April hogs closed moderately higher on the session as pork values continued to advance in the US and in China,” the Hightower Report said…
Farm Commodity Newsletter/Iowa Farmer Today
Wed 3/13/2019 8:35 AM
Lean hogs - With the uptick in Chinese pork values, the possible increase in import activity should “begin to support pork values globally,” The Hightower Report said.
“The hog market is showing technical signs of an overbought condition, and futures are taking a huge premium to the cash market,” The Hightower Report said. “While this is a concern for the bulls, China has shown a history of importing commodities when in need, and their pork needs could increase significantly in the months ahead.”
Pork exports could see significant rise
Allendale reported there are ideas that U.S. pork exports to China could at least double due to African swine fever. Rich Nelson, Allendale's Chief Strategist, said that the range could be between 728 mln to 1.513 bln head, well above last year’s 335 mln head. That range would give a 7-30 percent increase.
After falling yesterday, “the beef market is strong enough to support higher cash cattle trade this week if packers need to pay up,” The Hightower Report said. “It is a tough call to say if the weather this week will be enough to slow the long liquidation selling by speculators.”
Tue 3/12/2019 4:44 PM
In weighted average negotiated prices for barrows and gilts, USDA reported;
National carcass base was up $2.42 to $49.61/cwt.
National live was 56 cents higher to $37.91
Iowa-Minnesota carcass base rose $1.53 to $50.11
USDA reported carcass cutout values this afternoon rose $1.20 to $67.62/cwt.
“Prices could be overbought on the short-term basis and attempting to stabilize around these current price levels,” Stewart-Peterson said. “With talk that the U.S. and China are moving forward again with trade negotiations, African swine fever issues may begin to hold more weight with China pork values rallying very quickly.”
Today’s hog market activity was somewhat in response to the previous two trading days. “The market seems to be trying to attempt to absorb the surge in buying of the past two sessions with a small range today,” the Hightower Report said.
Cattle futures fall on improving conditions
Cattle markets were lower, in part due to improving feedlot conditions on the horizon. “The market pushed sharply lower on the session into the midday and closed sharply lower on the day,” the Hightower Report said. “The selling pushed the market down to the lowest level since Feb. 15.”
Increasing pork values provided support for hog markets. “April hogs closed moderately higher on the session as pork values continued to advance in the US and in China,” the Hightower Report said. “The buying pushed the market up to the highest level since Jan. 24. June hogs also closed higher after choppy and two-sided trade early.”
Grains turn up on positive news
“The ag market space drew support from fund short covering and technical buying,” Ami Heesch, with CHS Hedging, said. “Hearing that the EPA is set to go ahead with their E15 ruling, which would allow E15 gasoline to be sold during the summertime. Recent studies suggest there is very little difference between the current E10 gasoline and the proposed E15 gasoline.”
Corn markets bounced back on some positive news. “Prices have bounced back within their Bollinger band range today after closing in slightly oversold territory yesterday afternoon,” Stewart-Peterson said. “Regained optimism about U.S./China trade negotiations is also a positive, and funds should be prepared to buy back short contracts if progress continues.”
Concerns about delayed corn planting provided some support for markets. “The corn market traded higher on spillover strength form the wheat market,” Ami Heesch, with CHS Hedging, said. “Prices drew additional support from ideas of delayed corn plantings this year from the snow and rain.”
Tighter corn supplies and better ethanol demand also helped the corn market. “The turnaround was in part due to an oversold technical picture with managed funds near record short corn futures, talk of tight US domestic corn free supplies and better than expected demand for ethanol,” Steve Freed, VP of Grain Research for ADM Investor Services, said.
Acreage totals provided soybean support, but trade uncertainty still limited the upside for now. “The soybean market traded higher on ideas of being oversold, and a lower acreage number for this year,” Ami Heesch, with CHS Hedging, said. “Gains were limited on uncertainty over the fate of the US/Chinese trade war situation.”
Tighter supplies and improving demand also supported soybeans. “Talk of tighter US domestic soybean supplies, better than expected demand for US soymeal, lower estimate for the 2019 Brazil soybean crop and lower estimate for US 2019 soybean planted acres offered support,” Steve Freed, VP of Grain Research for ADM Investor Services, said.
Wheat markets were up today, receiving some support on news from Russia. “Russian wheat prices have halted their recent decline, with domestic supplies becoming very tight very quickly,” Stewart-Peterson said. “This is supportive to wheat prices worldwide, especially during a time when tenders are active.”
“The wheat market tore higher on technicals and short covering in Chicago, after making recent contract lows over the past few days,” Ami Heesch, with CHS Hedging, said. “Prices drew additional support as bargain hunters emerged, taking advantage of the lower board prices. KC and Mpls followed Chicago to higher levels.”