Wednesday Closing Grain and Livestock Futures
Mar. corn closed at $3.97, down 9 and 1/2 cents
Jan. soybeans closed at $10.19 and 1/4, down 18 and 1/2 cents
Jan. soybean meal closed at $364.60, down $4.90
Jan. soybean oil closed at 31.97, down 92 points
Mar. wheat closed at $5.89 and 3/4, down 12 and 1/4 cents
Dec. live cattle closed at $163.55, down $1.15
Feb. lean hogs closed at $81.20, up 2 cents
Feb. crude oil closed at $53.27, down $.85
Mar. cotton closed at 60.27, down 171 points
Jan. Class III milk closed at $15.91, down $.04
Jan. gold closed at $1,183.90 down $16.30
Dow Jones Industrial Average: 17,823.07, down 160.00 points
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Market News Recap
Soybeans were pressured on New Year’s Eve by end-of-the-year selling. Some of South America’s soybean growing area has rain in the forecast, which will be good for crop development. Export demand is expected to slow ahead of South America’s harvest moving into full swing. As of the end of the Wednesday session, March soybeans posted its lowest close in over three weeks, according to DTN.
Corn ended lower on Wednesday partly because of profit taking. There was also pressure because of a more than two percent drop in ethanol production in the latest weekly report. That’s after three consecutive weeks of record production. In addition, the inventory of ethanol jumped by 500,000 barrels to 18.1 million barrels. The Wednesday close was March corn’s lowest in more than two weeks.
Wheat ended the Wednesday session lower. Similar to corn, the March contract in Chicago was the lowest it’s been in more than two weeks. The cold snap in North America should have added a degree of support to the market, but it seems to have been ignored, plus there aren’t many other weather issues. And the dollar is still going up, which works against export demand.
A light to moderate cattle trade was evident in all areas on Wednesday afternoon. Packers agreed to spend more money in order to complete procurement chores ahead of the holiday. Live business in the South was generally 4.00 higher than last week from 166.00 to 168.00. USDA Mandatory reported dressed sales in the North were 7.00 higher at 265.00, and live sales 2.00 to 6.00 higher at 166.00. The kill totaled 91,000 head, 50,000 more than last week, and not comparable to a year ago.
Boxed beef cutout values are sharply higher on moderate to fairly good demand and light to moderate offerings. Choice boxed beef is up 1.70 at 248.90, and select is 1.83 higher at 238.57.
Chicago Mercantile Exchange live cattle contracts settled mixed from 117 points lower to 70 higher. Initial gains in the market were replaced by moderate losses in the front months, as traders tried to adjust to the recent gains in the complex. Focus in the market appeared to be on end of the year positioning more than anything else especially given the aggressive rally in boxed beef prices. December settled .17 lower at 165.70, and February was down 1.15 at 153.56.
Feeder cattle ended the session 50 to 200 points higher after bouncing higher and lower through the morning. The main focus in the complex was end of the year positioning rather than any specific or fundamental shift. January settled 1.12 higher at 219.45, and March was up 1.07 at 217.32.
Lean hogs settled mostly 2 to 57 higher with only April lower. Moderate end of the year support was seen through most nearby contracts but off the day’s highs. Trade remained sluggish throughout the session. February was .02 higher at 81.20, and April was down .15 at 83.27.
Barrows and gilts in the Iowa/Minnesota direct trade closed .29 higher at 75.92 weighted average on a carcass basis, the West was up .31 at 75.88, and the East was not reported due to confidentiality. Missouri direct base carcass meat price was steady at 71.00. Midwest hogs were lightly tested on a live basis, steady to lower from 48.00 to 55.00.
The pork carcass cutout value was down 2.33 at 84.40 FOB plant. All primals were lower.
Pork packer margins remain quite attractive with nearly an $8 spread between carcass value and the cost of live inventory.
Wednesday’s hog slaughter was estimated at 373,000 head, 191,000 more than Christmas Eve with no comparison to New Year’s last year.