Tuesday's Closing Grain and Livestock Futures
Mar. corn closed at $3.88, down 3 and 1/4 cents
Mar. soybeans closed at $9.69, down 9 and 1/2 cents
Mar. soybean meal closed at $326.90, down $2.70
Mar. soybean oil closed at 31.45, down 56 points
Mar. wheat closed at $5.21 and 3/4, down 8 cents
Feb. live cattle closed at $159.10, up 65 cents
Feb. lean hogs closed at $61.52, up 25 cents
Mar. crude oil closed at $50.02, down $2.84
Mar. cotton closed at 62.51, up 21 points
Mar. rice closed at $10.23 and 1/2, down 20 cents
Feb. Class III milk closed at $15.75, down 3 cents
Feb. gold closed at $1,231.60, down $9.20
Dow Jones Industrial Average: 17,868.55, up 139.55 points
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Market News and ReCap
Soybeans were lower on fund and commercial selling. USDA lowered U.S. ending stocks to 385 million bushels, a little bit more than expected, and reduced the production guess for Brazil. However, USDA also raised the production estimates for Argentina and China. After the report, Brazil’s ABIOVE issued its latest estimate, projecting soybeans at 92.3 million tons and exports at 48 million. Soybean meal was mostly lower and bean oil was down, with both following the lead of soybeans.
Corn was lower on fund and technical selling. U.S. corn ending stocks were also lower than expected at 1.827 billion bushels. Still, that is a lot of corn and USDA reduced its feed demand outlook. In any event, the numbers weren’t all that bearish, but they certainly weren’t particularly bullish, either. Traders are now looking ahead to this week’s USDA Ag Outlook Forum, while getting ready for the prospective planting and quarterly stocks estimates out March 31. Ethanol futures were steady to firm.
The wheat complex was lower on fund and technical selling. U.S. wheat ending stocks came out at 692 million bushels and the world stocks estimate was also larger than last month. This latest set of numbers really just reinforces how bearish the fundamentals at this time. Russia’s Ag Ministry reports wheat exports for 2014 were 22.1 million tons, compared to 13.8 million in 2013. According to wire reports, Ukraine’s Ag Ministry states it is “ready to act” if grain exports go above current projections. Australia’s ABARE now sees 2014/15 wheat production at 23.61 million tons. South Korea bought 47,000 tons of U.S. milling wheat, along with 50,000 tons from Australia.
The feedlot cattle trade was at a virtual standstill on Tuesday afternoon with real bids difficult to identify. Buying interest should start to improve on Wednesday, but significant trade volume could easily be delayed until Thursday or Friday. Asking prices are generally around 165.00 in the South and 260.00 to 262.00 in the North. The kill totaled 109,000 head, 3,000 smaller than both a week and a year ago.
Boxed beef cutout values were steady on choice and higher on select on light to moderate demand and offerings. Choice beef 238.43, down .05. Select cuts were 1.26 higher at 233.56.
Chicago Mercantile Exchange live cattle contracts settled 65 points higher to 90 lower. February and April contracts were supported somewhat by the premium status of the recent feedlot sales, the balance of the pit was lower. Profit taking appeared to be the negative factor along with ongoing nervousness about demand in general. February settled .65 higher at 159.10 and April was up .12 at 153.77.
Feeder cattle ended the session 92 to 160 points in the red. Feeder cattle settled lower after surging higher on Monday. Part of the volatility is tied to thin trade volume, but part is also tied to the intense debate between supply bulls and demand bears. March feeders settled 1.60 lower at 202.02, and April was down 1.55 at 201.75.
Feeder cattle receipts at the Joplin, Missouri Regional Stockyards totaled 5072 head on Monday. Compared to last week, steers under 600 pounds were steady to 8.00 higher, over 600 pounds steady to 4.00 higher. Feeder heifers weighing less than 700 pounds were steady to 5.00 higher, over 700 pounds were steady. The demand was good for calves suitable for grazing, and moderate for heavy feeders, the supply was called moderate. Feeder steers medium and large 1 averaging 667 pounds brought 233.10 per hundredweight. 677 pound heifers averaged 214.73.
Lean hogs settled 25 points higher to 42 lower. The soon to expire February contract held moderate gains, pulled higher by the premium of the cash index. Some other contracts were lower pressured by the follow through selling and ideas of defensive fundamentals. The pork carcass cutout value at midday was sharply lower. February settled .25 higher at 61.25 and April was down .17 at 66.57.
There was slow to moderate hog market activity with moderate demand on Tuesday. Barrows and gilts in the Iowa/Minnesota direct trade closed 1.01 lower at 59.58 weighted average on a carcass basis, the west was down 1.30 at 59.21, and the East was .47 lower at 58.04. Missouri direct base carcass meat price closed steady to 2.00 lower from 52.00 to 57.00. Midwest hogs on a live basis were steady to 1.00 lower from 37.00 to 48.00.
The pork carcass cutout value was down 1.16 FOB plant at 72.54. Bellies and loins were both lower while other cuts were higher.
The soon-to-expire February lean hog contract ended Monday’s session 260 points lower at $61.28, nearly a 540-point discount to last Friday’s Chicago Mercantile Exchange’s two-day settlement index. Selling pressure on the board should subside soon, especially if the-cash market stabilizes.
The Tuesday hog slaughter was estimated by USDA at 435,000 head, 2,000 more than last week, and 18,000 greater than 2014.