The urgency of getting beef packing plants back on line is illustrated by graphing packer margins over the past few months. The beef industry will become increasingly distorted if farmers and ranchers are not allowed access to now shuttered packing plants. Live cattle futures will get a lift when Read more…
The value of corn has lost on the value of soybeans this spring. The reduction in demand for corn as fuel stock and the expectation of a surplus in new crop corn supplies has weighed on corn prices. Both in absolute terms and relative to soybeans. Farmers could Read more…
The USDA Rated 54% of the winter wheat crop in good or excellent condition in the fourth week of April 2020 compared to the five year average for that date of 51%. The graph displays the US winter wheat yield since 1988 and a forecast range for 2020 based Read more…
Our calculations suggest a feeder cattle supply on April 1 of 20.2 million head compared to 19.7 million head a year ago. Historically the feeder cattle supply has proved a useful barometer of feeder prices in the May July period. The last August feeder quotes on Friday (4/24/20) were very Read more…
Cattle feedlot placements dropped sharply last month while March marketings increased leaving a big drop in the number of cattle on feed April 1, 2020. First quarter placements were the fewest since 2015 while marketings during the January/March period were the largest since the year 2000. Since some slaughter Read more…
The USDA’s first new crop wheat supply/usage balance, scheduled for release next month, could post a small reduction in US wheat carryout stocks in 2020/2021. Our new crop wheat production forecast is based on the March planting survey and a continuation of the current relatively favorable weather pattern. We have Read more…
Pork export sales (namely to China) remain brisk at the same time the closure of processing plants has tightened U.S. pork supplies. Processors need to find a way to reopen plants and take advantage of strong pork demand and plentiful live hog supplies. Perhaps an aggressive virus testing program will Read more…
USDA Is scheduled to release the first U.S. corn supply usage balance of the 2020/2021 season in May. The May first balance estimates of the season are based on the March planting intention survey and the prevailing economic situation in early May. We have constructed a new crop corn Read more…
USDA Is scheduled to release the first U.S. soybean supply usage balance of the 20/21 season in May. The first balance estimates of the season are based on the March planting intention survey forecast and the size of the old soybean crop in South America. Leftover old crop Southern American Read more…
Midwest farmers got field work underway with slightly wetter than normal soils but much better conditions than a year ago.
We have scattered the Deliverable hog prices as a function of domestic per capita pork supply for the spring and summer period. The points for 2020 are based on the USDA’ April 2020 report forecast and current futures quotes. The spring contract is trading low on economic value while the Read more…
The rating for winter wheat declined this week to 57% good or excellent compared to 62% a week ago and also 62% in mid April 2019. Corn planting was reported at 7% complete compared to the five year average of 9%. A wet planting season cut corn area in Read more…
The USDA is scheduled to release the March Cattle On feed report on April 24. We estimate cattle placements last month at 1.95 million head compared to 2.01 million head in March 2019. Our marketing estimate for March is 1.85 million head compared 1.8 million head a year earlier. The Read more…
Feeder cattle are trading well below levels established in recent years. Feeder cattle are a residual claimant with bids based on the anticipated revenue from fat cattle and the cost of feed to finish cattle. Finished cattle have declined roughly 27% since the beginning of the current virus pandemic while Read more…
Deliverable hogs prices are at the recent five year low, but remain well above the all time low of $18/cwt in he 1995-2020 period. Large hog supplies and a leftward shift in domestic pork demand has pressured deliverable values. Seasonally cash hog prices have usually advanced from early spring into Read more…
The accompanying scatter study shows the April/June monthly high for corn prices as a function of the ratio of US corn carryout stocks to crop year corn food and industrial plus exports. The data is from the USDA April World supply/usage report. The concept is to use the least elastic Read more…
The USDA Rated 62% of the winter wheat crop in good or excellent condition on the 2nd week of April 2020 compared to the five year average for that date of 48%. The graph displays the US winter wheat yield since 1988 and a forecast range for 2020 based on Read more…
A sharp leftward shift in the corn ethanol demand function pulled the bottom out of the corn market this spring. A collapse in the crude oil market and a reduction in overall fuel demand from stay at home drivers cut the use of ethanol, a prime component of the domestic Read more…
The USDA cut the 2019/20 soybean export estimate this month but increased the crush assessment. Competition from the big South American soybean crop is reducing old export prospects. U.S. soybean processors have benefited from increased soybean meal disappearance and stronger soybean oil exports. The crush would be stronger but for Read more…
Live cattle futures are trading at a sharp discount to what would be expected from 1) the USDA’s April beef supply estimates and 2) the beef supply – live price function established in the period of 2000 through 2019. The economic downturn because of the virus quarantine is the dominant Read more…