A light cattle trade at higher prices on Friday

USDA Mandatory reported cattle trading was light in Kansas on moderate demand, compared to the previous week, live sales were 2.00 to 3.00 higher at 155.00. Trading was light in Nebraska on moderate to good demand. Compared to a week ago, a few live sales traded steady to firm at 155.00, and dressed sales 3.00 higher at 245.00. Trading was light in Iowa on moderate demand, dressed sales were 1.00 higher at 243.00. The weekly cattle slaughter was estimated at 584,000 head, 6,000 less than last week, and 49,000 head smaller than 2013.

Boxed beef cutout values were weak on light to moderate demand and moderate to heavy offerings. Choice boxed beef was .59 lower at 246.30 and select was .88 lower at 234.39.

Chicago Mercantile Exchange live cattle contracts settled 50 to 132 points higher. The fact that strong late week support quickly flooded back into the lean hog futures market changed the overall tone of the cattle market. Follow through buyer support quickly redeveloped, seemingly out of thin air, with moderate to strong gains holding. Word of cattle trading in the North at higher prices was also supportive late in the session. August went off the board at 155.90 up 1.25 and October was 1.32 higher at 151.42.

Feeder cattle ended the session 150 to 245 higher. Feeders shook off the early pressure as traders looked for additional support coming from both the lean hog and live cattle futures market. Trade mentality seemed to be focused on closing the week higher given the light trade volume and lack of additional fundamental pressure seen in the market. September settled 1.50 higher at 218.65, and October was up 1.95 at 216.72.

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Closing Grain and Livestock Futures: August 29, 2014

Sep. corn closed at $3.59, down 2 and 3/4 cents
Sep. soybeans closed at $10.89 and 1/2, up 15 and 3/4 cents
Sep. soybean meal closed at $439.50, up $6.30
Sep. soybean oil closed at 32.04, down 60 points
Sep. wheat closed at $5.50 and 1/4, down 6 and 1/4 cents
Aug. live cattle closed at $155.90, up $1.25
Oct. lean hogs closed at $98.12, up $2.65
Oct. crude oil closed at $95.96, up $1.41
Dec. cotton closed at 66.57, down 1 point
Sep. Class III milk closed at $23.95, unchanged
Sep. gold closed at $1,285.80, down $2.90
Dow Jones Industrial Average: 17,098.38, up 18.81 points

Friday midday cash livestock markets

Packer inquiry into the cattle is light to moderate. Look for buyers to turn up the heat over the next several hours, at least enough to get short term slaughter needs covered and grease the wheels for a Labor Day exit. A few late deals were scored in Nebraska on Thursday as high as 155.00 live and 243.00 dressed to regional buyers. Asking prices are around 155.00 to 156.00 live and 245.00 to 248.00 dressed.

Boxed beef values are lower in the morning report, with choice down .90 at 245.99, and select 234.78 down .49.

Feeder cattle receipts at Missouri auctions this week totaled 14,923 head. Compared to the previous week, feeder steers and heifers trended steady to 5.00 lower, although some southern markets did see instances of fully steady to firm markets on light weight feeders suitable for grazing wheat pastures. The supply of feeders offered at auctions was light as the August heat kept many producers at home. Feeder steers medium and large 1 averaging 624 pounds traded at 245.27 per hundredweight. 619 pound heifers averaged 227.43.

Barrow and gilt prices in the three major direct trade areas are not reported due to confidentiality. Nationally the market is .10 higher with a weighted average of 90.56 on a carcass basis. Missouri direct base carcass meat price is steady at 88.00. Most Midwest hog markets are closed for the holiday with only Peoria reporting 1.00 lower with a top of 62.00 live.

The pork carcass value is 1.00 higher at 101.62 FOB plant. The belly primal is over $15.00 higher.

Barring a huge surprise in country numbers, weekly hog kills will steadily climb from September through November. By Thanksgiving, pork demand will be challenged to handle an additional 300,000-plus heavy hogs on a weekly basis.

Solid finish for wheat, corn

Soybeans were mostly higher on technical buying and position squaring ahead of the first notice day. Contracts look a little oversold and the weekly new crop sales were strong at 1.3 million tons. Past that – the fundamentals look bearish and early yield numbers have been solid. Soybean meal was higher and soybean oil was lower on the adjustment of product spreads.

Corn was higher on short covering and technical buying, along with spillover from wheat. Corn pretty much just saw a bounce off of the recent lows. The weekly export numbers, fundamentals, and early yield numbers are all bearish. Ethanol futures were higher. Allendale reports South Korea’s Major Feedmill Group is tendering for 280,000 tons of optional origin corn.

The wheat complex was higher on commercial and technical buying. The trade’s watching the renewed tensions in Ukraine and the domestic spring harvest delays. Weekly export numbers were just about neutral, with good sales and slow shipments. The trade’s expecting light deliveries against the September CBOT contract. Australia’s Bureau of Meteorology notes dry weather around the eastern coast of Australia could threaten production this year.

Cash cattle trade was at a standstill

The cash cattle trade remained pretty much dead in the water on Thursday afternoon. Buying interest could surface late in the day if packers are serious about getting procurement complete before Friday, There were a few bids on the table from 151.00 to 152.00 live, and 240.00 to 241.00 dressed. Asking prices are around 155.00 plus live and 245.00 plus dressed. Bullish feedlot managers have been obviously cheered by the higher cattle futures prices. The kill totaled 114,000 head, 1,000 below last week and 11,000 down from last year.

Boxed beef cutout values were weak on choice and sharply lower on select on light to moderate demand and offerings. Choice beef was down .52 at 246.89 and select was 2.33 lower at 235.27.

Chicago Mercantile Exchange live cattle contracts settled 90 to 227 points higher. The live issues gained momentum through the morning trade with October futures leading the surge higher. This turn around in the market is likely to draw more attention to cash cattle prices at the end of the week. There could also be some additional interest by noncommercial traders stepping into the deferred contract months through Friday. August settled 1.45 higher at 154.65, and October was up 2.27 at 150.10.

Feeder cattle ended the session 37 to 270 points higher. The feeder trade moved quickly from the lead market to show more comfort in tagging along as the live futures market seemed to be doing the heavy lifting through the session. The focus on October live cattle reaching above 150.00 per hundredweight was the main incentive to get buyers to jump back into the game. August settled .37 higher at 218.52, and September was up 2.67 at 217.15. [Read more...]

Closing Grain and Livestock Futures: August 28, 2014

Sep. corn closed at $3.61 and 3/4, up 5 and 3/4 cents
Sep. soybeans closed at $10.73 and 3/4, down 12 cents
Sep. soybean meal closed at $433.20, up $16.70
Sep. soybean oil closed at 32.64, down 3 points
Sep. wheat closed at $5.56 and 1/2, up 9 and 1/4 cents
Aug. live cattle closed at $154.65, up $1.45
Oct. lean hogs closed at $95.47, down 45 cents
Oct. crude oil closed at $94.55, up 67 cents
Dec. cotton closed at 66.58, down 88 points
Sep. Class III milk closed at $23.95, down 3 cents
Sep. gold closed at $1,288.70, up $6.80
Dow Jones Industrial Average: 17,079.57, down 42.44 points

Thursday midday cash livestock markets

The cash cattle market is slow in developing on Thursday. The same starter bids evident yesterday at 151.00 to 152.00 live and 240.00 dressed are offered today, but little else. Buying interest should build through the day if packers are serious about completing procurement efforts before Friday. Asking prices are around 155.00 plus in the South and 245.00 plus in the North.

Boxed beef cutout values are near steady to significantly lower. Choice beef is down .34 at 247.07, and select is 2.02 lower at 235.58.

Receipts at the Creston, Iowa feeder cattle auction totaled 3213 head on Wednesday. There is no price comparison as the sale has not been reported for three months. Trade was active and demand was very good for the special customer appreciation BBQ auction. 89% of the cattle weighted over 600 pounds. Feeder steers, medium and large 1 averaging 832 pounds averaged 215.28 per hundredweight. 816 pound heifers averaged 205.56.

Barrows and gilt prices in the three major direct trade areas are not reported due to confidentiality. Nationally the direct trade is 1.65 lower with a weighted average of 90.45 on a carcass basis. Missouri direct hogs are steady with the base carcass meat price at 88.00. Buying interest is much lower prior to the holiday. Midwest barrows and gilts on a live basis are steady to 1.00 lower in a light test, from 61.50 to 70.00.

The pork carcass value FOB plant is .21 lower at 99.97 after sharp losses yesterday in the belly primal.

For the week ending August 23, Iowa barrow and gilts averaged 282.1 pounds, 0.4 pounds lighter than the previous week, but still 10.5 pounds heavier than 2013.

Continued strength in dairy markets

Cash cheese barrels held steady on the Chicago Mercantile Exchange on Wednesday, blocks increased a penny while butter lost 1.5 cents.  Class III futures were slightly lower.

Midwest cheese plants are running at or near capacity and no one seems to be contemplating any change in schedule through the holiday weekend.  Plants continue to add nonfat dry milk to vats to increase volume.  Dairy Market News notes cheese orders from food service and institutional buyers have come in earlier this year.  Last year they held-off waiting for prices to decline…which they didn’t.  Reports are the orders are also quite strong.  It is also noted that despite prices above $2, retail buyers have not backed-off.  Western cheese makers say despite strong production, current stocks are often below current demand.

National Dairy Products Sales Report for the week ending August 23rd: cheddar cheese blocks averaged $2.09 per pound up 5.2 cents from the previous week.  Barrels increased 6.5 cents to average $2.18.  Butter increased 12.2 cents to $2.54, nonfat dry milk decreased 2.3 cents to average $1.79 per pound and dry whey slipped 1.5 cents to 67.4 cents per pound.

 

Grains and oilseeds consolidate

Soybeans were mixed on commercial buying in September against speculative selling in the other months. The trade’s also at least a little concerned about a cooler, wetter weather pattern in parts of the Northern Midwest, but fundamentals are bearish. Early yield reports for soybeans have generally been strong. Soybean meal was higher and bean oil was lower on the adjustment of product spreads.

Corn was steady to fractionally lower. Early yield reports for corn have also been good and the trade’s expecting a very large, if not record, crop this year. Past that – there was no fresh supportive news and buying interest is very limited. Ethanol futures were higher. Ethanol production for the week ending August 22 averaged 913,000 barrels per day, down 24,000 on the week. Ethanol stocks were 17.3 million barrels, down 5.1%, and the largest week to week change since the week ending January 17.

The wheat complex was mixed, with Chicago and Kansas City up on technical buying. The trade’s watching spring harvest delays and what has been harvested is moving slowly due to a lack of railcars. The trade’s also keeping an eye on quality concerns in Europe. Egypt bought 175,000 tons of wheat (115,000 tons from Russia and 60,000 tons from Romania). According to Allendale, Algeria is rejecting French wheat, claiming Paris blended imported high quality wheat with poorer quality domestic supplies to make milling grade wheat.

Boxed beef and pork close significantly lower

Packer inquiry into the cattle remained light on Wednesday afternoon with just a few scattered bids at 151.00 to 152.00 live and 240.00 dressed. Significant business could be delayed until Thursday or Friday, but both sides would probably like to get things done by Thursday in order to clear the deck for the Labor Day weekend. Asking prices are around 155.00 to 156.00 in the South and 245.00 to 248.00 in the North. The slaughter totaled 114,000 head, 2,000 below last week and 9,000 less than 2013.

Boxed beef cutout values were lower on light to moderate demand and moderate offerings. Choice beef was down 1.07 at 247.41, and select was .88 lower at 237.60.

Chicago Mercantile Exchange live cattle contracts settled 35 to 125 points lower. Selling pressure seemed to be tied to long liquidation, demand nervousness, and thin volume. Many traders seemed to take a wait and see approach when it comes to weekend product demand and product clearance. If overall movement is better than expected, there is the expectation additional volume will be seen in early September to replenish working meat stocks. August settled .35 lower at 153.20 and October was down .42 at 147.82.

Feeder cattle ended the session 62 points higher to 100 lower with the front month contracts holding narrow gains due to a lack of interest and light trade in the complex. Uncertainty about upcoming weekend product movement created widespread concerns through the complex. August settled .62 higher at 218.15, and September was up .27 at 214.47. [Read more...]