[Fri]: … a supply chain mess… [Thurs]: Afternoon National Slaughter Cattle Review / Boxed beef cutout values this afternoon were sharply lower… Choice fell $15.07… Select went up 16 cents… In negotiated cash sales in Iowa/Minnesota, the USDA reported 42 head sold dressed at $180, with no live sales. There were no reported sales in Nebraska… In export sales, beef was at its lowest weekly totals since Dec. 26, The Hightower Report said. “Prior to this week, the sales pace had been the strongest on record, but this week’s numbers pulled cumulative sales behind last year and the year before”…
Farm Commodity Newsletter/Iowa Farmer Today
Fri 5/15/2020 8:28 AM
Cattle - The monthly Cattle on Feed report is due out at 2 pm. “We expect to see placements 1.6% over last year,” Allendale said. “It would continue five months in a row now of higher placements. We see January marketings, finished cattle leaving feedlots, at 2.4% under last year. Our placement and marketing estimates suggest a Feb. 1 On Feed total at 12.038 million head, 3.0% over last year.”
The USDA’s weekly Export Sales report showed the third consecutive new weekly low for beef sales, Brugler Marketing reported. They were down another 20% from last week’s previous low to 4,191 MT booked. Beef shipments were also suppressed, albeit less so, with 12,173 MT shipped.
Livestock industry faces dual troubles
Two pressing problems are facing the industry and various approaches to their solution are being explored - large financial losses that may have just started and a supply chain mess, Brugler Marketing reported. Financial relief, legislative action and beef buying programs are all attempting to deal with a solution. All of the options are bad options but this is an instance requiring the industry to chose the best of bad options.
Thu 5/14/2020 5:12 PM
Boxed beef cutout values this afternoon were sharply lower on Choice and steady on Select, USDA said.
Choice fell $15.07 to $450.92/cwt.
Select went up 16 cents to $437.40.
In negotiated cash sales in Iowa/Minnesota, the USDA reported 42 head sold dressed at $180, with no live sales. There were no reported sales in Nebraska.
Technical resistance is holding strong, as fundamentals strengthen, Stewart-Peterson said. “Slaughter so far this week has continued to improve, up 11% from last week but still down 26% from the same week last year,” they said. “Higher beef production, along with demand-stifling prices, have caused beef values to pull back.”
Despite some time until June futures will come up, “the front month live cattle contract sill seems to be finding support from the cash market,” Stewart-Peterson said.
Choppy day for hogs
Overall, it was a choppy day for the lean hog market, as cash index rallied due to expanding slaughter capacity, Stewart-Peterson said. “Slaughter for the week so far is up 21% from last week but is still down 20% from the same week last year.”
In export sales, beef was at its lowest weekly totals since Dec. 26, The Hightower Report said. “Prior to this week, the sales pace had been the strongest on record, but this week’s numbers pulled cumulative sales behind last year and the year before.”
Quiet day as exports examined
Today was a “super quiet” day in the market, Ami L. Heesch of CHS Hedging said. “Favorable weather conditions for much of the US Midwest seemed to take precedence over decent corn sales reported this morning and improving Chines demand for U.S. soybeans,” she said.
IEG Vantage is putting the U.S. corn acreage three million acres lower than the USDA projection, at 94.160 mln acres. Their soybean guess was 2.3 mln acres above the USDA report at 85.89 mln acres.
Corn was lower as favorable weather conditions are leading the market to start pricing in a possible record large crop in the U.S., Ami L. Heesch of CHS Hedging said. “The ethanol industry appears to be stirring again as folks begin driving around, picking up demand for gasoline,” she said. “It may take some time yet to get back to where we were prior to Coronavirus.
Corn hasn’t had the follow-through Oliver Sloup of Blue Line Futures hoped for, “dampening things in the near term,” he said on RFD-TV today. “it’s been a slow grind sideways,” he said, saying he is confident prices can get to $3.20 which might spark some short-covering.
“A lack of new news, moderate export sales and a sluggish tone” all led to a quiet market amongst all commodities, including soybeans, Stewart-Peterson said. “Tension between the US and China seem to be on the rise today as President Trump made comments indicating he was disappointed in Chinese response to COVID-19. We do wonder if he wasn’t in some way trying to tell China to step up and buy more sooner than later.”
Despite an early rebound, soybean prices couldn’t sustain higher, The Hightower Report said. “Reports of additional sales of U.S. soybeans and bean oil to China provided early support, as they raised hopes that Phase One purchases would continue despite tensions.”
Wheat saw mixed trade today as Chicago futures are now positive, Ami L. Heesch of CHS Hedging said. Australia wheat is expected to come out as a “decent sized crop” she said, as they receive wet weather over the next three months.
“Dry growing conditions in the southern Plains, Russia and Ukraine were a source of strength for wheat prices as they do not bode well for the current crop,” The Hightower Report said.