Page 8 - MWC 08-5-2021s
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The Midwest Cattleman · August 5, 2021 · P8


       Live Cattle                                                           Feeder Cattle Daily

      Live Cattle:                                                          Feeder Cattle:
         Though the lack of strength in the front end cash cattle trade is    The July 23 bi-annual Cattle report reminded the trade the base
      disappointing, there is evidence the coming fall and beyond period  producer remains in light liquidation. Over the past three years
      are set for higher pricing. The past five months of placements have  beef cow numbers have been reduced 3.1%. The first half of the year
      run below that of two years ago. Available feeder numbers for July  saw the largest beef cow cull in 11 years. Beef heifer retention was
      and August may run tight as well. End users have stopped their  also lower than expected. A grouping of factors is responsible, the
      minimal purchases of front end needs and are aggressively ordering  most recent of which is dryness in the North. We continue to sug-
        Live Cattle:  My thoughts center around this market stabilizing now.  I’ve been
                                                                               Feeder Cattle:  All you have to do is look at the corn market for a reason for the
       placing a bullish tilt to this market for some time now.  I may need to temporarily  gest two to three years ahead of higher prices. Declines in produc-
      for October and beyond procurement.                                   pull-back in feeders. If I owned a feedlot I’d be nervous to say the least.  I do feel
       place this on “hold” for a while.  The higher placements the last three months will  tion will be seen with packing capacity increases.
         Cattle feeders may feel a little wary paying up for feeders on the
                                                                            the feeder market has overdone it to the downside and it will be tough to break it
                                                                              Feeder numbers available for placements in the months ahead
       have a negative impact on prices yet, so like they say, “All good things come to those
      hope of better days ahead. In this case though, the coming breakev-   further.  The early corn harvest has most feeder buyers in the field and I don’t think
                                                                            they’ve really had time to concentrate on buying feeders.  Let’em get caught up a
       who wait”.  I see production numbers staying over last years’ levels until at the
      ens of +$137/cwt. for Q1 finishers may warrant it. The US consumer  will remain tight. Placements from August 2020 through June 2021
                                                                            little and they’ll head to town.....checkbooks in hand....bulging with “corn” money.
       least the end of the year.  Beef shipments have been lagging last years’ levels now
      will be facing tightening supplies of beef over the coming two to  are 2.2% over the prior year. That is based off a 2020 calf crop 1.3%
       for about a month.  Two weeks ago they were 8% lower than last year.  This weeks
                                                                            This market will rally....wait and see.
      three years and at least for first half 2022, will also be seeing small-
       report showed exports a whopping 56% lower than last year.  This ain’t good.  Low  smaller than the prior year. The next two months ahead are likely
       imports and high exports have held this market up all summer.  We’re starting to  to run below prior year levels.
      er than needed pork offerings. This is a period where calves and
      feeders get the first crack at higher prices and aggressive forward
       lose some of that.  I just can’t pull the trigger yet on long term bullish hopes.
      bookings by cattle feeders may be rewarded.
                                                                                                  Trading commodity futures involves substantial risk of loss
                                                                                                  and my not be suitable for all investors.  The recommendations
       Rich Nelson                                                                                express opinions of the author.  The information they contain is
       Allendale Inc.                             Allendale Inc.                                  obtained from sources believed reliable, but is in no way guaran-
       815-578-6161                                                                               teed.  The author may have positions in the markets mentioned
                                                                                                  including at times positions contrary to the advice quoted herein.                                                                  Opinions, market data, and
                                                                                                  recommendations are subject to change at any time.
       What Does this Report Mean to Me?
        Q #1
       Q: What is the outlook for corn?
       What do you think the price of fats will be in April 2011
       Answer: It’s hard to see the forest for the trees here, but peering through the foliage I see $105.00 fats on the horizon for April.  Demand is
       A: Though July temperatures in the Western Cornbelt were five degrees over normal, and most of the
       going to have to kick in though in order to get it.
       west ended the month with below normal rains, pollination came off just fine. The dip in temperatures at
       the heart of pollination, along with good early-month rains, were the trick. That may allow a chance for
        Q #2
        Due to the recent break in feeders, would you be holding your fall-weaned
       long term procurement, through Q1 needs, at $5.10 via the December.
       calves for a while or letting them go?
       Q: Are you looking at hedges on coming calf or feeder marketings?
       Answer: What ever happened to the easy questions?  This will depend upon your weaning sched-
       ule and your available feed supply.  I’m long term bullish the feeder market but the “reality” of
       right now probably dictates letting them go.  If you keep them for an extra 30 days, make sure you
       A: Given the tightening supply narrative for fat cattle headed into first half 2021 we may see the January
       minimize the grain in the ration.  Grow them on good forage....”sell” $4.50 corn.  If the fat market
       feeder contract push to $175.
       stays sluggish and corn prices don’t moderate, about the only thing you’ve got to hang your hat on
       for “higher feeders” is “Hope”.
                                                                             November  6th
                                                                               Lunch at 11:00 a.m.

                                                                                   Sale at 12:30
                                                                                      Sale Offering
                                                                              16 - 2010 Heifer Calves Jan. - May
                                                                              16 - Breeding Bulls 7 to 18 months             RH Standard Lad 0313
                                                                              16 - Spring Calving Bred Females                Solid As A Rock Sire Group
                                                                              16 - Spring Calving Black Females  Reynolds Herefords
                                                                                      Bred to Hereford Bulls
                                                                              8 -    Fall Calving Pairs          1071 County Road 1231
                                                                              6 -    Show Steer Prospects
                                                                              Both Horned & Polled Offered        Huntsville, MO 65259
                                                                                                          Home: 660-277-3679 • Matt: 660-676-3788
                                                                               November 5, 2010 Sale offerings on
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                                                                                    CHB Dinner at 6:00 P.M.        • Barb: 660-676-4788
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