[Weds]: There was a “minor” decline in USDA’s pork production estimate, Allendale said. They expect a 35 mln pound decline, but that would still put totals at more than 3.7% over last year. Another 3.4% is being called for next year… The lean hog market is still dealing with a bearish short-term supply, The Hightower Report said, as U.S. demand fails to keep up. “This has led to a weakening cash trend during a period when cash normally pushes higher”… [Tues]: National carcass base up 60 cents… Iowa-Minnesota carcass untested… USDA reported carcass cutout values this afternoon were down 30 cents… 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…
Farm Commodity Newsletter/Iowa Farmer Today
Wed 6/12/2019 8:49 AM
Lean hogs - There was a “minor” decline in USDA’s pork production estimate, Allendale said. They expect a 35 mln pound decline, but that would still put totals at more than 3.7% over last year. Another 3.4% is being called for next year.
This is still no sign of a short-term low, The Hightower Report said. “The market seems to have the export news to turn up, but domestic demand remains sluggish,” they said.
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, as 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
In weighted average negotiated prices for barrows and gilts, USDA reported:
National carcass base up 60 cents to $75.30/cwt.
National live up 65 cents to $59.26/cwt.
Iowa-Minnesota carcass untested at $75.65/cwt.
USDA reported carcass cutout values this afternoon were down 30 cents to $83.76/cwt.
July lean hogs were down $1.82 to close at $84.37, more than $2 off the contract high. The Hightower Report says the lean index fell 35 cents, while pork cutout values were up nearly $1.50. USDA’s Supply & Demand estimates dropped pork production by 35 million pounds, while exports were increased by 220 million pounds.
Stewart-Peterson says July hogs are testing their 200-day moving average once again.
“This line has been a major technical objective over the past two weeks,” they said. “Cash fundamentals remain choppy, with the index lower and carcass values higher.”
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.