[Mon]: Production is ramping up to meet retail demand for beef, The Hightower Report said, as they look to fill the supply chain. “In the end, we have a surplus of meat, but again, the short-term setup is temporarily bullish,” they said. “The recovery in the cash market and a further surge in beef prices should support the market short-term”… [Fri]: Boxed beef cutout values this afternoon were sharply higher on Choice and lower on Select… Choice was $3.88 higher… Select was 89 cents lower… In negotiated cash sales in Nebraska, the USDA reported 190 head sold live for $111, and 262 head sold dressed for $175. In Iowa-Minnesota, there were 446 head sold live for $111-113, and 260 head sold dressed for $175… “Dressed steer weights are still increasing against the normal seasonal tendencies which can inflate production totals, but right now, the cattle markets are only focused on production chain speed,” Stewart-Peterson said. “Beef values are at their highest levels since June 2017 in a massive rally so far this week”… “The Cattle-on-Feed report was considered very neutral as the actual numbers from the USDA were very close to expectations,” the Hightower Report said…

 

Farm Commodity Newsletter/Iowa Farmer Today

 

Mon 3/23/2020 8:44 AM

 

Cattle - The initial coronavirus reaction of the cattle futures markets, shooting quickly down, was a “knee jerk” reaction. However, William Moore of Price Futures Group said the demand seen at the retail level “has been unprecedented.”

 

Production is ramping up to meet retail demand for beef, The Hightower Report said, as they look to fill the supply chain. “In the end, we have a surplus of meat, but again, the short-term setup is temporarily bullish,” they said. “The recovery in the cash market and a further surge in beef prices should support the market short-term.”

 

Can reports keep livestock higher?

 

Mike Zuzolo of Global Commodity Analytics said Friday’s Cattle on Feed report was “no better than neutral.” He wondered if it was enough to keep meat futures moving higher, adding that “some major packers (are) adding premium on to marketed cattle sales starting this week...to pass-on some of the sharp price increases in boxed-beef.”

 

The cold storage report will be released today at 2 p.m. Central, with expectations for 673 mln pounds of pork storage and 456 mln pounds of Beef storage. The pork number would be a 100 mln pound increase over last month’s mark, while the beef stocks guess would be a 34 mln pound decrease from last month, Allendale said.

 

Fri, Mar 20, 4:37 PM

 

Boxed beef cutout values this afternoon were sharply higher on Choice and lower on Select on light to moderate demand and moderate to heavy offerings, the USDA said.

 

Choice was $3.88 higher to $253.75/cwt.

Select was 89 cents lower to $240.17.

 

In negotiated cash sales in Nebraska, the USDA reported 190 head sold live for $111, and 262 head sold dressed for $175. In Iowa-Minnesota, there were 446 head sold live for $111-113, and 260 head sold dressed for $175.

 

“Dressed steer weights are still increasing against the normal seasonal tendencies which can inflate production totals, but right now, the cattle markets are only focused on production chain speed,” Stewart-Peterson said. “Beef values are at their highest levels since June 2017 in a massive rally so far this week.”

 

“April cattle closed 355 points higher… up 307 points for the week,” the Hightower Report said. “This represents a key weekly reversal which is many times a technical sign that a significant low is in place. The continued advance in the beef price plus higher cash trade this week are factors which provided strong support to the heavily discounted April cattle futures.”

 

Cattle on feed considered neutral

 

“The Cattle-on-Feed report was considered very neutral as the actual numbers from the USDA were very close to expectations,” the Hightower Report said. “Feb. placements came in at 92.1% as compared with trade expectations for 92.4% of last year with a range of 89.0% to 97.1%. Marketing's for Feb. came in at 105.5% from trade expectations for 105.6% of last year.”

 

“April hogs closed 107 points higher on the session and this left the market with a gain of 585 points,” the Hightower Report said. “With contract lows on Monday, the weekly key reversal is seen as a bullish technical development. The buying pushed the market up to the highest level since March 11.”

 

Soybeans rebound, virus still looms

 

“The virus continues to wreak havoc around the world,” Ami Heesch, with CHS Hedging, said. “There are many concerns sifting around the globe, from necessary equipment for healthcare workers and possible port closures that have taken place or are expected to take place. Fears are that we are headed for a recession or that we are already in a recession.”

 

Expanding livestock production in China did provide some optimism for grain markets. “News of expanding livestock production in China is supportive, and China bought 756,000 tons of corn today from the U.S.,” Stewart-Peterson said. “The export situation in Argentina is still the source of much confusion, which is ultimately supportive.”

 

Corn

 

“This week corn futures got some good news in the buying of US corn by China,” Steve Freed, with ADM Investor Services, said. “The bad news is that overall demand for US corn exports continue to run behind the pace to reach USDA goal. The other bad news was the talk that because of poor margins US ethanol producers may have to take downtime.”

 

Corn markets started moving up on a variety of factors but then drifted lower as the day progressed. “Corn prices rose on bargain buying, improving demand and recovery in the crude oil market,” Ami Heesch, with CHS Hedging, said. “Prices turned lower midday as crude oil prices weakened to over two bucks a barrel.”

 

Soybeans

 

Soybean markets were up on a variety of factors and global headlines. “The soy complex traded higher on spillover strength in the soymeal market, and a better export demand outlook with the recent purchases from China and logistical snags in South America,” Ami Heesch, with CHS Hedging, said.

 

“Soybean meal has been the strongest member of the soy complex this week due to ideas that reduced ethanol production would cut DDG supplies, which in turn could boost demand for soybean meal,” Stewart-Peterson said. “The U.S. dollar is down today and the real is up which is also making U.S. beans more competitive on the export front.”

 

Wheat

 

“Talk of lower EU supplies and the unexpected China buying of US wheat helped futures trade higher,” Steve Freed, with ADM Investor Services, said. “…This week concentrated effort by World Banks to infuse capital and lower interest rates raised hope that any decline in World/US economy may be short lived.”

 

“Wheat prices continue to higher levels on heightened concerns of flour supplies as the CoronaVirus takes its toll on the US,” Ami Heesch, with CHS Hedging, said. “There is thought to be a real need for restocking the shelves at the grocery store, resulting in increased domestic demand as well.”

 

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