[Mon]: Supply is slowly tapering off into late Spring, The Hightower Report said. “The short-term surge in pork values should keep buyers active,” they said. “Look for choppy to higher ahead”… [Fri]: National carcass base was up 5 cents… Iowa-Minnesota carcass base rose 54 cents… USDA reported carcass cutout values this afternoon were $1.11 higher… “Export sales this week were solid, making their third-highest total of the year so far,” Stewart-Peterson said. “Carcass weights are beginning to trend lower along with the normal seasonal trend which is beneficial in keeping production levels down and news that China released 20,000 tons of pork from state reserves overnight was also supportive”…
Farm Commodity Newsletter/Iowa Farmer Today
Mon 3/23/2020 8:44 AM
Lean hogs - April hogs seems to be trading in concert with April cattle, William Moore of Price Futures Group said. “Massive domestic demand” helped support the pork market through the latter half of last week, he said. As foreign demand “was no slouch either,” seeing exports at 184% of last year.
Supply is slowly tapering off into late Spring, The Hightower Report said. “The short-term surge in pork values should keep buyers active,” they said. “Look for choppy to higher ahead.”
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
In weighted average negotiated prices for barrows and gilts, USDA reported;
National carcass base was up 5 cents to $56.12/cwt.
National live was 17 cents higher to $43.33
Iowa-Minnesota carcass base rose 54 cents to $56.58
USDA reported carcass cutout values this afternoon were $1.11 higher to $80.04/cwt.
“Export sales this week were solid, making their third-highest total of the year so far,” Stewart-Peterson said. “Carcass weights are beginning to trend lower along with the normal seasonal trend which is beneficial in keeping production levels down and news that China released 20,000 tons of pork from state reserves overnight was also supportive.”
A higher week provided some hope from a technical market perspective. “The market looks to close higher for the week after a contract low, and the key weekly reversal is seen as a bullish technical development,” the Hightower Report said. “Pork cut-out values at midsession came in at $77.82, down $1.11 on the day.”
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.”
“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.”
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.”
“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.”