As Tuesday starts to draw to a close the market is showing some weather concerns for row crops in the US. Money flow is mixed with no particular direction being picked up in any sector.
Outside equities see’s stock indices on both sides of unchanged with little movement. The dollar was seeing some light safe haven buying as economic data continues to look poor for China and leads to broader concerns about the global economy.
China’s top financial firm CITIC Securities is believed to have lowered the base salary of workers at its investment bank division by 10-15%. This comes following reports earlier this year about large Chinese financial firms sharply cutting annual bonuses by 30-50%. There is also plenty of rumors of Chinese towns struggling to meet debt obligations with a stagnate property market in China. This of course is unconfirmed though with Chinese government data unavailable on such things.
In the grain complex traders are keeping a close eye on the skies over the Big I states and they’re looking for rain. The USDA crop progress data out Monday showed Illinois corn at 50% good to excellent. That was down 31% from last year and down 25% from the 5 year average. Iowa corn was 77% good to excellent down just 14% from a year ago. Nebraska corn meanwhile climbed 1% week over week to 62% good to excellent.
In the international market the bombing of a large dam in Ukraine has the trade concerned about future crop production. The dam was critical infrastructure for much of the area’s irrigation. However for Ukrainian grain supply EU is allowing Poland, Bulgaria, Romania, Hungary, and Slovakia to ban domestic sales of Ukrainian grains until Sept 15th. President Zelenskiy is calling for an immediate removal of the ban because it will restrict Ukrainian exports and cause storage difficulties for the winter wheat harvest.
In the livestock sector cattle continue to march higher and put in new contract highs. For Tuesday the most active August live cattle contract saw a high of $175.95. That may show some technical resistance at $176. Feeder cattle followed the live cattle higher. Lean hogs were able to resume there rally from last week. That may be dampened though with a sharp drop in belly prices on Tuesday.
This week’s fed cattle trade is trying to get going on Tuesday. Packers were bidding $190-$191 live in Nebraska and Iowa. At the time of this writing there were not takers at that price.
Last week’s fed cattle cash trade was very active. Northern dressed deals had a huge range of $280 to $297, mostly $292, about $8 higher than the previous week’s weighted averages. Southern live sales had a range of $171 to $180, mostly $178 to $180, roughly $7 to $9 higher than the prior week’s weighted averages.
For the week ending May 27, 2023, Imported Beef Passed for Entry in the U.S. totaled 38,659, 92.94% of the previous week and 94.88% of the 4-week average.
Daily slaughter estimates Tuesday
125,000 hd today 126,000 hd wk ago 126,000 hd yr ago
469,000 hd today 480,000 hd wk ago 476,000 hd yr ago
Wednesday Midday Carcass Cutout
Choice up 5.32 319.51
Select up 2.46 299.19
C/S Spread 20.32
Carcass dn 3.78 85.28
Bellies dn 22.49 80.37
Pre-opening grains with Mark Gold of Top Third Ag Marketing
Pre-opening livestock with Jerry Stowell of Country Futures
Midday market commentary with Mike Zuzolo of Global Commodity Analytics
Closing grain market commentary with John Payne of Hedge Point Global Markets No Audio 5-24