Tuesday's Closing Grain and Livestock Futures
Dec. corn closed at $4.22, up 5 and 1/2 cents
Jan. soybeans closed at $13.19 and 3/4, down 1 and 1/2 cents
Dec. soybean meal closed at $446.10, down 90 cents
Dec. soybean oil closed at 39.90, down 44 points
Dec. wheat closed at $6.53 and 3/4, up 4 cents
Dec. live cattle closed at $132.52, down 72 cents
Dec. lean hogs closed at $84.82, down $1.20
Jan. crude oil closed at $96.04, up $2.22
Mar. cotton closed at 78.61, down 1 point
Dec. Class III milk closed at $18.86, up 26 cents
Dec. gold closed at $1,221.70, down 60 cents
Dow Jones Industrial Average: 15,914.62, down 94.15 points
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Market News Review
Soybeans were mixed with nearbys down and deferreds up on the adjustment of old crop/new crop spreads. There’s good rainfall in the forecast over the next few days for key growing areas of Brazil and the trade expects increased domestic acreage next year. Fundamentals remain bullish, but there’s continued talk about China cancelling recent purchases. It’s definitely worth noting though that, as of yet, no Chinese cancellations have surfaced this week. Soybean meal was mixed on spread adjustments inside the pit and bean oil was lower on profit taking and technical selling.
Corn was higher on short covering and technical buying. Winter weather in parts of the Plains and Midwest is delaying the tail end of harvest activity and there’s also some renewed bargain hunting around current price levels. In any event, fundamentals are bearish due to this year’s record crop, so the pit may have problems putting together a long winning streak. Ethanol futures were higher, supported by solid margins and good demand.
The wheat complex was higher on short covering, technical buying, and the mostly lower dollar. The Southern Plains should see a return to freezing temperatures over the next few days, but the crop is in very good condition at this point. Wheat’s fundamentals continue to look basically neutral. Russia’s Ag Ministry reports this year’s grain harvest is 95% complete at 95.3 million tons, compared to 74.5 million last year.
The cash cattle trade was quiet on Tuesday afternoon with bids few and far between. It sounds like asking prices are around 134.00 plus in the South and 212.00 plus in the North. Though the basis has strengthened in recent weeks Southern cattle feeders should still see nearby premiums as incentives to resist just steady packer bids and hold out for higher asking prices. The kill was estimated at 121,000 head, 4,000 below last week, and 7,000 smaller than a year ago.
Boxed beef cutout values were steady on choice, but lower on select on light to moderate demand and moderate offerings. Choice boxed beef was .06 lower at 203.00, and select was down 1.53 at 189.95.
Live cattle contracts on the Chicago Mercantile Exchange settled unchanged to 72 points in the red. Moderate pressure developed through the complex as traders looked for additional direction from outside markets. The softness in beef values created some softness through the market as commercial pressure was most evident. Contracts were stuck in a narrow trading range. December settled .72 lower at 132.52, and February was down .17 at 134.10.
Feeder cattle ended the session 32 to 50 lower due to pressure in the live pit. Gains in the grain markets created some renewed concerns that additional buyer activity may return to the feed markets. January settled .50 lower at 164.85, and March was down .42 at 165.20.
Feeder cattle receipts at the Joplin Regional Stockyards on Monday totaled 8916 head. Compared to last week, steer and heifer calves and yearlings trended steady. The demand was moderate to good on a heavy supply. Producers are taking advantage of the mild weather to market their cattle as the weather is expected to drastically change in a few days. 426 feeder steers medium and large 1 averaging 572 pounds brought 175.23 per hundredweight. 203 heifers weighing 573 brought an average of 159.81.
Lean hogs settled 5 to 147 points in the red on a combination of the lack of fundamental support in cash hog prices and pork values and firming grain markets. Aggressive triple digit losses developed at midsession. The pressure was not due to any new information seen in the market, but just a lack of additional buyer interest surfacing at the beginning of the month. December settled 1.20 lower at 84.25, and February was down 1.47 at 88.97.
Barrows And gilts in the Iowa/Minnesota direct trade closed 1.43 lower with a weighted average of 80.34 on a carcass basis, the West is down .96 at 80.25, and the East is down .19 at 77.97. The Missouri direct base carcass meat price closed steady from 71.00 to 72.00. Terminal hogs were 2.00 higher to 2.00 lower from 53.00 to 56.50 live.
The pork carcass cutout value closed .54 lower at 90.99 FOB plant.
For the last four reported weeks, weekly sow slaughter has averaged 59,500 head, down 4% from the same period in 2012. While PED remains a major question mark, there’s clearly evidence suggestive of expansion plans.
The Tuesday hog kill was estimated by USDA at 440,000 head, 4,000 more than last week, and 8,000 up from last year.