9/20/24
The Livestock Markets all made new 1-month highs today. The Fats led the way higher. December’24 Live Cattle were 2.07 ½ higher and settled at 183.20. Today’s high was 183.20 and that is the new 1-month high as well. Today’s low was 180.00 and the 1-month low is 173.17 ½. Since 8/20 December’24 Live Cattle are 8.17 ½ higher or more than 4 ½%. The Feeders were up a little bit. October’24 Feeder Cattle were 12 ½ cents higher today and settled at 243.90. Today’s high was 245.30 and that is the new 1-month high as well. Today’s low was 242.02 ½ and the 1-month and 52-week low is 229.35. Since 8/20 October’24 Feeder Cattle are 12.57 ½ higher or almost 5 ½%. The Hogs were unable to stay positive today. December’24 Lean Hogs were 7 ½ cents lower today and settled at 74.22 ½. Today’s high was 74.65 and that is the new 1-month high as well. Today’s low was 74.02 ½ and the 1-month low is 66.77 ½. Since 8/20 December’24 Lean Hogs are 6.15 higher or 9%. The Cattle on Feed Report was today, and Cattle on Feed was 1% higher than this time last year. Placements were down 1% from last year, and Marketings were 4% below last year. Well, that report did not have much Market moving information, but I am going to read it as Bearish. I spoke with several feedlots today, and bids were 183 maybe 184 in some locations, but nothing had traded yet. Feedlots are normally not this full, this time of year, so I see that as Bearish. It looks like The Cattle Markets could be tied to the US Stock Market for a while. If the Stocks sink lower next week or anytime soon, then I believe the Cattle Markets could follow straight down. It has been a strong rally recently, but the lows are not that far away, and if negative news hits the Market, it can break faster than you think. Let’s see how the Stock Markets open Sunday night, and how the Livestock Markets react Monday morning. Thank you, to the Gentleman who has a large feedlot in Texas and called me this morning with information on what the Packers were bidding, and what the holdout price was as well. I appreciate it.
The Grains did not do much today, but there was another opportunity to sell Soybeans today. November’24 Soybeans were 1 ¼ cents lower today and settled at 1012. Today’s high was 1019 and the 1-month high is 1031 ¼. Today’s low was 1001 ¼ and the 1-month low is 960 ¼. Since 8/20 November’24 Soybeans are 36 cents higher or almost 4%. The Corn was lower as well. December’24 Corn was 4 cents lower today and settled at 401 ¾. Today’s high was 407 ¼ and the 1-month high is 416. Today’s low was 401 ½ and the 1-month and 52-week low is 385. Since 8/20 December’24 Corn is 3 ¾ or almost 1%. The Wheat settled in the green. December’24 Wheat was 3 cents higher today and settled at 568 ½. Today’s high was 575 ¾ and the 1-month high is 598 ¾. Today’s low was 565 ¼ and the 1-month and 52-week low is 520 ¾. Since 8/20 December’24 Wheat is 12 cents higher or more than 2%. China has purchased a record number of Soybeans, but not from the US Farmer. Last month China purchased 12.14mmt of Soybeans, and almost 84% of them were from Brazil. Beans from the US accounted for only 1.7% of China’s purchases last month. From January through August, China has purchased almost 54mmt of Soybeans from Brazil. That is an increase of 217% from last year. China purchased just 12.8mmt of Soybeans from the US Farmer, down 73% over the same time period. The weather looks like it could be changing in Brazil as well. Future weather models are showing a good possibility for rains to return in early October. If they do arrive, it could be another factor pushing the Beans lower during harvest time, and at the same time as the next WASDE Report on October 11th, when there could be a change in the numbers for US Soybean production. If Pro Farmers numbers are more accurate than the USDA, then the yield numbers and ending stocks will be much higher. Argentina is planting 7% more Soybeans, and CONAB says Brazil is planting 3% more Soybeans with production estimates of 166.28MT up 12.82% from last year. The USDA has the Brazilian production number at 169.34MT. The Soybean yield here is a record at 53.2 bushels per acre, with ending stocks at 550 million bushels. Pro Farmer had a completely different take on the Soybean crop compared to the USDA. Pro Farmer had ending stocks at 675 million bushels. Then there is China. They have been stockpiling Soybeans in case of a trade war or if they cause problems in the South China Sea. The US tariffs on China’s EV’s will be in effect starting on September 27th, just one week from today. If China decides to retaliate, I am guessing they will hit the agricultural sector first, probably starting with the Soybeans. If China puts a huge tariff on the Beans or just stops buying them, what will happen to the price of Soybeans, in a Market that I feel is overpriced anyway. I still recommend selling calls and buying puts in November’24 and March’25 Soybeans early and often. I can show you the Call or Put Strikes I would buy or sell. I structured Option trades in March’25 Beans yesterday and sent them to many of you. They are all Bearish trades, and March’25 was trading 1047 ¼ when the trades were structured. If you are interested in seeing my trade examples or have any other questions, give me a call or send me an email. BALLEN@WALSHTRADING.COM
-Bill
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