[Weds]: “With trade negotiations restarting this week and a major need from China for imports, we see exports picking up steam and pork products on the rise,” The Hightower Report said… [Tues]: National carcass base down 1 cent… Iowa-Minnesota carcass base up 23 cents… USDA reported carcass cutout values this afternoon fell 45 cents… "We haven't had anything new to feed the bull," Scott Shellady said of the lean hog market. "We didn't have anything come out and we have a decently strong dollar." He said the market is still very volatile about China, but right now the bulls don't have anything in the immediate-term to be excited…
Farm Commodity Newsletter/Iowa Farmer Today
Wed 9/18/2019 8:34 AM
Lean hogs - “With trade negotiations restarting this week and a major need from China for imports, we see exports picking up steam and pork products on the rise,” The Hightower Report said.
The news of South Korea culling many pigs due to African Swine Fever means more potential for U.S. exports. Allendale said South Korea accounted for 12% of all exports from the U.S., or 727 mln pounds.
Reports coming out soon
Friday marks the release of the Cattle on Feed report. Allendale said average guesses for the report are showing cattle on feed down 0.7% from last year, while placements are expected to be down 6.3% and marketings are expected to be down 1.7%.
With that, next Monday’s Cold Storage report is expected to show a 624 mln pound pork stock level for the end of August, Allendale said, compared to the five-year average of 593 mln pounds. Beef stocks are anticipated to come in at 471 mln pounds, above the five-year average of 454 mln pounds.
Tue 9/17/2019 4:31 PM
In weighted average negotiated prices for barrows and gilts, USDA reported;
National carcass base down 1 cent to $45.08/cwt.
National live fell 89 cents to $36.92
Iowa-Minnesota carcass base up 23 cents to $45.76
USDA reported carcass cutout values this afternoon fell 45 cents to $68.21/cwt.
"I just feel a little bit of a deflationary cycle coming on," Scott Shellady said. "I hope I'm wrong, but that has some of these traders concerned."
The market was lower on the idea that futures are at a strong premium to the cash, The Hightower Report said. "The market remains concerned with the hefty short-term supply even with elevated exports," they said.
Cattle bounces higher
Cattle saw a big bounce today, as it saw its highest close since the end of August. The market started off with choppy and two-sided selling, The Hightower Report said, but still managed to trade sharply higher on the day.
"We haven't had anything new to feed the bull," Scott Shellady said of the lean hog market. "We didn't have anything come out and we have a decently strong dollar." He said the market is still very volatile about China, but right now the bulls don't have anything in the immediate-term to be excited.
Markets weaker Tuesday
Today saw some "pre-harvest rebalancing" meaning a weaker day in the markets overall, Brian Eley of Andersons Grain said. "Futures seemingly ran out of steam today after last week's rally."
In world news, Saudi Arabia's energy Minster reported their oil supply is back online following the weekend attacks. Crude oil's October contract is down $4.15/barrel.
"There wasn't anything bullish... so you see the market tailing off," Scott Shellady said about the corn market today. After the recent bounce, he said the market is overall starting to fall in sympathy with crude oil, he said. "A nice 22% bounce and now we are retrenching a little bit."
Trade saw the crop progress report as more bearish than expected, Michaela White of CHS Hedging said, as trade expected to see a decline in conditions. Conditions remained unchanged in yesterday's report.
Yesterday's gains were given back after good weather came across much of the U.S., Michaela White of CHS Hedging said. "Additional pressure comes as the market sees a lessening demand for soybeans as African Swine Fever continues to spread, with South Korea now reporting the disease," White said.
"Brazil soybean planting remains delayed due to ongoing dry conditions," Brian Eley of Anderson's Grain said, with Argentina struggling for rain as well. "Weather needs to be watched worldwide," he said.
With rains continuing, spring wheat harvest is "dragging on," Michaela White of CHS Hedging said. Some of the weakness in today's market came as it traded in sympathy with corn and beans as well.
"The dollar was weaker throughout today's session and that may have provided some underlying support," Stewart-Peterson said. "Today's close, in the middle range, really doesn't tell us much technically other than the market failed to follow through for a fourth-consecutive day of higher closes."