[Weds]: The recent bounce in cattle can be supported by the prospects of “normal” weather returning, combined with a slowdown in placements and not as burdensome beef production, The Hightower Report said… The USDA is showing the second largest drop in beef production on record from the fourth quarter to the 2020 first quarter, which may support the February cattle contracts… [Tues]: Boxed beef cutout values were firm… Choice up 73 cents… Choice up 73 cents… In negotiated cash sales in Nebraska, the USDA reported no live sales, with dressed sales of 39 at $182.00. In Iowa, no live sales. Dressed sales of 267 were reported at $183.46… Barchart.com reports wholesale boxed beef prices were mixed Tuesday, which Choice boxes up 76 cents and Select boxes down 12 cents. Monday’s slaughter was estimated at 121,000 head, a 3,000-head increase from a year ago but steady compared to last week…
Farm Commodity Newsletter/Iowa Farmer Today
Wed 6/12/2019 8:49 AM
Cattle - The recent bounce in cattle can be supported by the prospects of “normal” weather returning, combined with a slowdown in placements and not as burdensome beef production, The Hightower Report said.
The August live contract was “the most stable product in the livestock quadrant” yesterday, according to Ben DiCostanzo of Walsh Trading. However, the August feeder cattle contract may stumble due to the possibility of increased feed costs with strength in the corn market.
Cattle surging on 'impressive' rally
Yesterday saw the cattle market hit its highest point since May 30. The Hightower Report called it an “impressive” rally, given the recent sell-offs in the hog market. The USDA is showing the second largest drop in beef production on record from the fourth quarter to the 2020 first quarter, which may support the February cattle contracts.
The lean hog market is still dealing with a bearish short-term supply, The Hightower Report said, aa U.S. demand fails to keep up. “This has led to a weakening cash trend during a period when cash normally pushes higher,” they said.
Tue 6/11/2019 4:46 PM
Boxed beef cutout values were firm on Choice and weak on Select on light to moderate demand and offerings.
Choice up 73 cents to $222.39/cwt.
Select down 54 cents to $208.25/cwt
In negotiated cash sales in Nebraska, the USDA reported no live sales, with dressed sales of 39 at $182.00. In Iowa, no live sales. Dressed sales of 267 were reported at $183.46.
August live cattle prices were up 52 cents to close at $106.82, just 25 cents off the contract high. August feeder cattle prices were down $1.70 to close at $138.12. The Hightower Report says weakness in the hog market helped with fed cattle prices. Decreased slaughter weights were helping to provide some price support Tuesday.
Barchart.com reports wholesale boxed beef prices were mixed Tuesday, which Choice boxes up 76 cents and Select boxes down 12 cents. Monday’s slaughter was estimated at 121,000 head, a 3,000-head increase from a year ago but steady compared to last week.
Hogs fall with talk of huge production
August hogs were sharply lower Tuesday, giving back all gains from Monday. The Hightower Report says a sluggish cash market and more talk of huge production due to higher slaughter weights turned the tone bearish. Prices closed at their lowest level since mid-March.
Cattle markets were up slightly at mid-day, according to Stewart-Peterson. Feeder markets were trading in very tight ranges when compared to recent sessions. Average weights have been coming down, but Stewart-Peterson says domestic retail demand needs to pick up before futures can move higher.
Corn gains from Supply & Demand report’s yield cuts
USDA’s Supply & Demand report indicated corn yields should be much less than expected, averaging 166 bushels per acre compared to 177 a month ago. Production estimates also dipped to 13.680 billion bushels compared to 14.040 billion bushels last month. The Hightower Report says corn acreage was also revised down to 89.8 million acres.
Strength in the corn market spilled over into the soybean side, with futures closing slightly higher. Barchart.com says the USDA also made a revision to their old crop carryout, with the increase coming from a reduction to expected exports.
July corn closed at $4.27¾, up 12 cents. September corn closed up 12¼ cents, just barely lower than the contract high. The Hightower Report says USDA’s cut of 810 million bushels in ending stocks is the largest monthly cut in recent history. World ending stocks were down considerably as well.
The USDA estimates 83% of the corn crop is now planted, leaving 15.3 million acres left to plant, primarily in Illinois, Indiana, Ohio and South Dakota.
ADM Ag Market View says the USDA also dropped feed estimates due to the smaller crop.
ADM Ag Market view reports soybean planting is behind normal, with some agronomists believing bean yield estimates by the USDA may be too high. The USDA says 60% of the crop has been planted. Estimated planting acres are at 84.6 million acres, with yields remaining at 49.5 bushels per acre, according to the USDA Supply & Demand report.
July beans closed up ¾ at $8.59¼, with August beans closing at $8.66¼. The Hightower Report says the Supply & Demand report was considered bearish for beans with no estimated yield change and a slight increase in production.
July wheat closed up 10½ cents at $5.18. September wheat closed up nearly a dime. The Hightower Report says the market firmed up after the Supply & Demand report, which was considered neutral. Wheat production was up slightly from last month’s estimates.
ADM Ag Market View reports it was somewhat surprising wheat prices were up, considering the uptick in production. Some analysts believe lower corn supplies could increase feed demand for wheat. The USDA raised its import and feed usage estimates for wheat.