[Mon]: China’s trade war with Australia might spark some increase in beef sales to China, according to The Hightower Report… [Fri]: Afternoon National Slaughter Cattle Review / Boxed beef cutout values this afternoon were steady… Choice was up 16 cents… Select was down 17 cents… In negotiated cash sales in Nebraska, the USDA reported no live sales, and 78 head sold dressed for $160. In Iowa-Minnesota, there were 394 head sold live for $100, and no dressed sales… Analysts are watching falling beef prices and the impact of the week-ending cattle-on-feed report… Friday’s trading was largely quiet as traders waited for more information and watched for technical indicators from the market…
Farm Commodity Newsletter/Iowa Farmer Today
Mon 6/22/2020 8:55 AM
Cattle - Friday’s Cattle on Feed report showed cattle inventories slightly higher than expected. This report showed the number of cattle marketed in May was the fewest ever reported since this reported began in 1996, Ami Heesch of CHS Hedging reported.
China’s trade war with Australia might spark some increase in beef sales to China, according to The Hightower Report.
Beef may regain some markets
The alternative proteins or plant-based products enjoyed good support during the shortages of meat in supermarkets. As meat prices fall and processing is restored to a more normalized level, beef should re-capture some of the lost markets to these products. It will regain market share because it is a better product at a better price, according to The Cattle Report.
Trade frictions with China could intensify short-term, due to customs issues, which could lead to more meat in the U.S. for U.S. consumers to absorb.
Fri 6/19/2020 5:05 PM
Boxed beef cutout values this afternoon were steady on Choice and Select, the USDA said.
Choice was up 16 cents to $213.72/cwt.
Select was down 17 cents to $203.91.
In negotiated cash sales in Nebraska, the USDA reported no live sales, and 78 head sold dressed for $160. In Iowa-Minnesota, there were 394 head sold live for $100, and no dressed sales.
Analysts are watching falling beef prices and the impact of the week-ending cattle-on-feed report. “Beef prices falling quickly,” Stewart-Peterson said. “Cash cattle markets are drifting lower so far this week. The Cattle on Feed report this afternoon expected to show on-feed supply at 98.7%.”
Friday’s trading was largely quiet as traders waited for more information and watched for technical indicators from the market. “Very quiet price action ahead of today’s Cattle on Feed report.” Stewart-Peterson said. “Live and feeder markets are still within recent consolidation ranges and have not broken nearby support or resistance.”
Choppy day hits cattle
“August cattle experienced choppy and two-sided trade early in the day, but the market closed moderately lower on the day and not far off of the lows,” the Hightower Report said. “Fears that China is increasing restrictions on imports of food helped to pressure the market as this could force beef to compete in an environment where pork and poultry supplies swell.”
“The market opened higher on the session with hopes that China would fulfill its phase 1 trade agreement with the US, and that they would purchase additional pork from the US,” the Hightower Report said. “However fears of new restrictions on food moving to China helped to trigger selling, and the market closed sharply lower on the day.”
Markets quiet going into weekend
“Another quiet day in the markets as the weekend approaches,” Ami Heesch, with CHS Hedging, said. “Soybeans were strong for the week on ideas that US/Chinese tensions were easing slightly, along with hopes that China will continue to honor their Phase One Trade Agreement commitment as they have stated that they would many times.”
Export news from China and Brazil provided some support for soybeans. “News that China and US trade negotiations are continuing, and talk that China will buy more US soybeans helped to support,” the Hightower Report said. “In addition Brazil soybeans for export are priced well above US so traders are hopeful that China buys US soybeans over the near term.”
Corn moved slightly higher on Friday. “The corn market traded slightly higher in thin volume ahead of the weekend,” Ami Heesch, with CHS Hedging, said. “Most months saw a 6-7 cent trading range. Prices drew underlying support from bouts of fund short covering and overall lack of farmer selling.”
“Corn futures edged higher. Some of the buying was linked to optimistic US and China talks that could open the door for China to increase buying of US corn, ethanol and meat,” Steve Freed, with ADM Investor Services, said. “There is also talk that China may soon approve new import quotas that would allow them to buy 5 mmt of US corn.”
Demand helped push soybeans higher. “Soybean prices were stronger on decent demand for US soybeans and spillover strength in the soyoil market,” Ami Heesch, with CHS Hedging, said. “Prices drew additional support from today’s rally in the energy market. Farmers were noted sellers of soybeans in modest volume.”
“Soybean traded higher,” Steve Freed, with ADM Investor Services, said. “World that China may increase buying US soybean offered support… US soybean export prices are cheaper to China than Brazil. US Midwest 7-day weather forecast calls for normal rains and normal temps. Key is July weather with some forecasting a return of above normal temps and below normal rains.”
“The wheat market was mixed with Chicago on the defensive from increases in global supplies, KC weakness from harvest activity and better than expected yields and Mpls drawing strength from this week’s dryness across the Northern Plains and the Canadian Prairies,” Ami Heesch, with CHS Hedging, said.
“Wheat futures traded marginally lower,” Steve Freed, with ADM Investor Services, said. “Increase US winter wheat harvest offered resistance. Talk of slower World demand for wheat imports also weighed on prices. Optimistic trade talks between US and China offered support. Rumors of China interest in US wheat supported US export basis.”