[Tues]: Beef prices “continue to advance to the highest level since June,” The Hightower Report said and with expectations for higher cash trade, the market is staying supported… [Mon]: Afternoon National Slaughter Cattle Review / Boxed beef cutout values this afternoon were sharply higher… There were no reported negotiated cash sales in Iowa/Minnesota or Nebraska, USDA said… There is a lot of momentum in live cattle as contracts continue to make higher highs and higher lows, Oliver Sloup of Blue Line Futures said. "The path of least resistance is higher,” he said. “The bulls want to see the cash prices firm up”…
Farm Commodity Newsletter/Iowa Farmer Today
Tue 4/6/2021 8:49 AM
Cattle - Beef prices “continue to advance to the highest level since June,” The Hightower Report said and with expectations for higher cash trade, the market is staying supported. “Consider buying setbacks,” they said.
“The money flow and technical picture is driving this market, but the fundamentals are validating that strength at this time with the combination of potential cash strength and the surge in retail prices,” Total Farm Marketing said.
Cattle moving strong, hogs more cautious this week
Cattle futures are higher as the week starts on “good cash optimism and technical buying,” Total Farm Marketing said. The cash prices are still undefined this week, but the trend was higher last week and much of the same is anticipated this week.
The hog market “is still looking for a top,” but there is a cautious tone in price action, indicating it may be close, Total Farm Marketing said. However, they note fundamentals are “extremely strong” to start the week.
Planting underway in some areas
The first crop progress of the year was shown, with 2% of the corn planted. CHS Hedging this is in line with average pace, but “slightly behind” expectations.
Weather forecasts are positive for those in the northwest growing regions, John Payne of Daniels Trading said, as it may alleviate some drought in those areas. However, the continued rain hitting the Southeast Delta region may cause some flooding, which may delay soybean planting.
Mon 4/5/2021 4:25 PM
Boxed beef cutout values this afternoon were sharply higher on Choice and Select, USDA said.
Choice rose $5.82 to $258.678/cwt.
Select went up $2.89 to $249.86.
There were no reported negotiated cash sales in Iowa/Minnesota or Nebraska, USDA said
Restaurant traffic continues to improve, as demand is expected to grow as more vaccines rollout, Total Farm Marketing said. “Packers are expected to be somewhat aggressive this week as they can’t afford not to purchase cattle to meet strong demand.”
There is a lot of momentum in live cattle as contracts continue to make higher highs and higher lows, Oliver Sloup of Blue Line Futures said. "The path of least resistance is higher,” he said. “The bulls want to see the cash prices firm up.”
Livestock demand staying strong
Short term demand “is very strong” in the cattle market, and the uptrend has the door open for even higher cash cattle this week, The Hightower Report said. There is some cause for caution as the market enters overbought territory, they said.
The tightening hog supply situation “is seasonally expected” and has been enhanced by the pork pipeline reopening, The Hightower Report said.
Weather markets coming in grains
After last Wednesday’s report, markets were incredibly volatile to close out the week. Oliver Sloup of Blue Line Futures said another USDA report coming this week we are seeing expanded ranges. “I don’t know that this upcoming report is going to have much of an impact,” Sloup said. “A lot of focus is going to be on weather.”
Equity markets were strong today, but energy markets struggled, CHS Hedging said. OPEC+ will ese production cuts in May, "as well as concerns over potential demand declines overseas," they said.
The next WASDE report will come out on Friday.
“Our weather guys April Midwest forecast is warm with mostly normal rains,” ADM Investor Services said. “Summer 2021 forecast calls for normal to above temps. Rain could be below normal in north plains and south plains with normal rains in the Midwest. Some could see drier late July and August.”
Today's mixed trade came as old crop fell and new crop contracts rose, CHS Hedging said. "Despite strong new crop prices, producer activity seemed light as many are more focused on the upcoming planting season," they said.
“There is talk that South America is offering soybean for export below U.S. prices,” ADM Investor Services said, and that some South American cargoes “may have been sold into the east coast.” They noted that Brazil weather is staying dry.
Soybean crush was down 16% in February compared to January, Total Farm Marketing said. “Bearish concerns for the soy complex might be renewed with COVID restrictions in some areas (such as France),” they said
Slow demand is a “bearish catalyst” for wheat prices long term, Total Farm Marketing said, combined with better than expected new-crop conditions in the EU and the Black Sea.
"There are persistent concerns in Minneapolis wheat territory about dryness, with some stating that it is too dry to plant due to the potential for wind erosion," CHS Hedging said.