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Corn prices continued to show evidence of stabilizing after months of extreme volatility. After a bearish report from USDA on Friday, December Corn futures were up more than three cents for the week ended Tuesday, while the March contract lost just two cents and the early-summer contracts were down less than two cents. The Supply and Demand report showed a predicted increase in ending stocks of five million bushels compared to a pre-report estimate of a five million decrease. The change came from a usage reduction in the food/seed/industrial category, leaving open the possibility of future changes in the export category if the dollar remains strong. A sharp increase in China’s corn production estimate for the harvest just completed also pressured corn values.
Soybean prices were weaker compared to last Tuesday, with the January futures contract off 11 cents, while the March lost more than a dime and new-crop November was down 13. The predicted ending stocks of soybeans were higher than both last month’s estimate as well as pre-report guesses by analysts. The change was primarily a result of a reduction in forecast exports for the balance of the marketing year.
Higher global production estimates and reduced U.S. exports combined to produce an increase of 50 million bushels of wheat compared to last month’s report. As a result, December Wheat futures in Kansas City lost more than 17 cents, while the March contract was off 20. In Chicago, the December dropped seven cents for the week, while March lost almost 13 cents.
Livestock prices were mixed last week, but with a lower bias. The biggest drop came in cash fed cattle sales, which were at mostly $120, a four dollar drop compared to the previous week. Poor packer margins and increasing supplies of fed cattle combined with weak boxed beef cutout values fueled the decline. Live Cattle futures were also lower, with the December contract off 95 cents, while February lost 90 and April was down 65 cents. The strong basis makes it likely that another price reduction is in store for the cash markets this week, especially since the Choice cutout is down $1.05 and Select is off $1.93 compared to last Tuesday.
Feeder Cattle futures were higher this past week, as the January contract gained $1.77 and March was up $1.15, but cash feeder auctions were mixed in early week trade. The weak fed cattle trade and stabilizing corn prices reduced the incentive for feedlots to try and capture a bigger share of the reduced inventory of feeder cattle and calves.
Lean Hog futures were lower this week, but cash butchers in Red Oak were a dollar higher, trading at $58 on Tuesday. The wide spread between beef and pork prices continues to provide underlying support to hog values.
This Friday is the last major report from USDA before Christmas, as the December 1 Cattle on Feed report is released. The approaching holidays mean reduced supplies and lower demand for feeder cattle for the next three weeks or so and short holiday work weeks require fewer fed cattle and hogs as well. Thinner trade will also affect the grain markets as Christmas approaches. Outside markets will continue to be a factor and may take on even greater significance with lower trade volume and reduced fundamental news during the next three weeks.
Corn prices continued to show evidence of stabilizing after months of extreme volatility. After a bearish report from USDA on Friday, December Corn futures were up more than three cents for the week ended Tuesday, while the March contract lost just two cents and the early-summer contracts were down less than two cents. The Supply and Demand report showed a predicted increase in ending stocks of five million bushels compared to a pre-report estimate of a five million decrease. The change came from a usage reduction in the food/seed/industrial category, leaving open the possibility of future changes in the export category if the dollar remains strong. A sharp increase in China’s corn production estimate for the harvest just completed also pressured corn values.
Soybean prices were weaker compared to last Tuesday, with the January futures contract off 11 cents, while the March lost more than a dime and new-crop November was down 13. The predicted ending stocks of soybeans were higher than both last month’s estimate as well as pre-report guesses by analysts. The change was primarily a result of a reduction in forecast exports for the balance of the marketing year.
Higher global production estimates and reduced U.S. exports combined to produce an increase of 50 million bushels of wheat compared to last month’s report. As a result, December Wheat futures in Kansas City lost more than 17 cents, while the March contract was off 20. In Chicago, the December dropped seven cents for the week, while March lost almost 13 cents.
Livestock prices were mixed last week, but with a lower bias. The biggest drop came in cash fed cattle sales, which were at mostly $120, a four dollar drop compared to the previous week. Poor packer margins and increasing supplies of fed cattle combined with weak boxed beef cutout values fueled the decline. Live Cattle futures were also lower, with the December contract off 95 cents, while February lost 90 and April was down 65 cents. The strong basis makes it likely that another price reduction is in store for the cash markets this week, especially since the Choice cutout is down $1.05 and Select is off $1.93 compared to last Tuesday.
Feeder Cattle futures were higher this past week, as the January contract gained $1.77 and March was up $1.15, but cash feeder auctions were mixed in early week trade. The weak fed cattle trade and stabilizing corn prices reduced the incentive for feedlots to try and capture a bigger share of the reduced inventory of feeder cattle and calves.
Lean Hog futures were lower this week, but cash butchers in Red Oak were a dollar higher, trading at $58 on Tuesday. The wide spread between beef and pork prices continues to provide underlying support to hog values.
This Friday is the last major report from USDA before Christmas, as the December 1 Cattle on Feed report is released. The approaching holidays mean reduced supplies and lower demand for feeder cattle for the next three weeks or so and short holiday work weeks require fewer fed cattle and hogs as well. Thinner trade will also affect the grain markets as Christmas approaches. Outside markets will continue to be a factor and may take on even greater significance with lower trade volume and reduced fundamental news during the next three weeks.
