[Tues]: Under certain circumstances, pork prices may rebound, according to Jason Franken, agricultural economist at Western Illinois University. “With projections that domestic demand starts to recover and exports continue to grow, prices are forecast to rebound to $54.28/cwt and $67.10/cwt in the first and second quarters of 2021,” he said. “Of course, if negative impacts of COVID-19 on U.S. consumption persist or if export demand doesn’t remain as resilient as anticipated, then U.S. hog prices would likely fall short of these projections,” he said… [Mon]: National Daily Hog and Pork Summary / National carcass base was 20 cents lower… Iowa-Minnesota carcass base fell 72 cents… USDA reported carcass cutout values this afternoon were 74 cents lower… “Some strength in pork product prices on Friday along with ideas that slaughter supplies should taper off into July helped to support,” the Hightower Report said… “Hog slaughter last week was 10.7% higher than the same week last year, and slaughter today was well ahead of the same day last year,” Stewart-Peterson said…

 

Farm Commodity Newsletter/Iowa Farmer Today

 

Tue 6/30/2020 8:40 AM

 

Lean hogs - Hog markets made very slightly higher closes yesterday, finding support from rallying cash fundamentals despite pressure from last week’s bearish Hogs and Pigs report, said Stewart-Person Marketing. Prices could be ready for a bounce as August hogs actually made a ”bullish key reversal Monday,” Stewart-Peterson said.

 

Another all-time record hog inventory amidst the COVID-19 pandemic extends further downward pressure on prices, according to a university economist. “The USDA’s June Hogs and Pigs report places the June 1 inventory of all hogs and pigs at 79.6 million head, up 5.2% from a year ago. That’s just above the upper range of pre-report expectations and well above the midpoint of 3.7% higher,” according to Jason Franken, agricultural economist at Western Illinois University.

 

Potential for a price bounce exists

 

Under certain circumstances, pork prices may rebound, according to Jason Franken, agricultural economist at Western Illinois University. “With projections that domestic demand starts to recover and exports continue to grow, prices are forecast to rebound to $54.28/cwt and $67.10/cwt in the first and second quarters of 2021,” he said. “Of course, if negative impacts of COVID-19 on U.S. consumption persist or if export demand doesn’t remain as resilient as anticipated, then U.S. hog prices would likely fall short of these projections,” he said.

 

Cash cattle prices have come down significantly over the past month. “The reopening of restaurants around the country has been slower than expected and this is seen as a factor which might keep the cash market trend down,” The Hightower Report said.

 

More workers are returning to the slaughterhouse, but the meat packers continues to be behind on slaughter, which has made heavier animals and more pressure on the meat market, according to Dan Morgan Grain and Livestock Hedging. “The market continues to have a downward bias, but the foreign trade has held in quite well on meat exports,” Morgan said.

 

Mon 6/29/2020 4:38 PM

 

In weighted average negotiated prices for barrows and gilts, USDA reported;

 

National carcass base was 20 cents lower to $28.33/cwt.

National live was down $1.59 to $23.37

Iowa-Minnesota carcass base fell 72 cents to $28.65

 

USDA reported carcass cutout values this afternoon were 74 cents lower to $65.21/cwt.

 

“Some strength in pork product prices on Friday along with ideas that slaughter supplies should taper off into July helped to support,” the Hightower Report said. “Technical indicators are oversold but not at an extreme. Pork cut-out values at midsession today came in at $69.53, up $3.58 on the day.”

 

“Hog slaughter last week was 10.7% higher than the same week last year, and slaughter today was well ahead of the same day last year,” Stewart-Peterson said. “Weights are down, but carcass values’ resiliency to this kill pace shows just how strong demand is, both domestically and abroad.”

 

Livestock markets see support

 

Cattle markets have been down lately, but Monday provided a good technical sign. “August cattle closed moderately higher on the day with an outside-day up,” the Hightower Report said. “This is a bullish technical development. The early selling pushed the market down to the lowest level since June 23. In fact, the market has traded inside the range of June 23 ever since.”

 

Hog markets saw some support from strength in pork product prices. “August hogs closed slightly higher on the day after choppy and two-sided trade early in the day,” Stewart-Peterson said. “The market managed to make new contract lows by just five points before turning to trade slightly higher on the day into the midsession.”

 

Grain markets square for Tuesday's report

 

Analysts were looking ahead to Tuesday’s USDA June acreage report, and how it will compare to expectations. Traders are expecting a small reduction in corn acreage estimates. “The grain markets garnered support from outside markets and position evening ahead of the USDA data release tomorrow,” Ami Heesch, with CHS Hedging, said.

 

“Expectations for weekly crop ratings to remain high were negated by expectations for temperatures to move into the upper 80s or low 90s throughout much of the Midwest,” Stewart-Peterson said. “Areas that recently received light rainfall will need more rain soon. In other words, the weather market is still alive and well.”

 

Corn

 

“Tomorrow’s quarterly Stocks report is expected to show 4.951 bln bushels on hand,” Stewart-Peterson said. “This would be compared to the June report of last year, which was 5.202 bln and the March report of 7.953 bln. Acreage is expected to come in at 95.2 mln, down from the March estimate of 97 mln with a range of 97.1 to 93 mln.”

 

“The corn market traded higher on a month end/quarter end short covering and strength from the energy and equity markets,” Ami Heesch, with CHS Hedging, said. “Prices drew additional support from a small reduction expected in tomorrow’s acreage report. There were rumors that China might be in the market for US corn, although there has been no confirmation of that.”

 

Soybeans

 

“Tuesday, USDA will release estimates of US June 1 stocks and US 2020 acres by crop,” Steve Freed, with ADM Investor Services, said. “Trade estimates US June 1 soybean stocks near 1,392 mln bu. versus 1,783 last year. Trade also estimates US 2020 soybean acres near 84.8 mln versus USDA March guess of 83.5 and 76.1 last year.”

 

“The soybean market traded slightly higher from strength in the oil market and outside influences. Prices drew additional support from short covering ahead of the USDA acreage and stocks report. Gains were limited from mostly favorable weather conditions and ideas of a decent crop in the making.”

 

Wheat

 

“Wheat prices were mostly higher, bouncing back from last week’s selloff, with the emergence of the bargain hunters,” Ami Heesch, with CHS Hedging, said. “Additional support came from improving demand including rumblings that China might be in the market for some wheat. Algeria and Jordan are in for a jag of optional origin wheat.”

 

“Wheat futures rallied on short covering before July contract first notice, USDA acreage and June 1 stocks report,” Steve Freed, with ADM Investor Services, said. “End of month and quarter end trading may have also offered support. Wheat futures have dropped recently to new lows on active US winter wheat harvest and lower Europe prices.”

 

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