Weekly Commodity Prices Update (7/9)
For the week:
September corn was down 62 1/2 cents and December corn was down 62 3/4 cents. August soybeans closed down 54 cents and November soybeans were down 69 3/4 cents. September KC wheat closed down 25 1/4 cents, September Chicago wheat was down 37 3/4 cents and September Minneapolis wheat was down 24 1/2 cents.
From Friday to Friday livestock futures scored the following changes: August live cattle down $2.77, October live cattle down $2.50; August feeder cattle up $2.13, September feeder cattle up $2.40; July lean hogs up $2.35, August lean hogs up $1.35.
Beef net sales of 23,700 mt reported for 2021 were up 96% from the previous week and 64% from the prior four-week average. The three largest buyers were South Korea (10,400 mt), Japan (5,800 mt) and China (2,700).
Boxed beef prices closed lower: choice down $3.38 ($278.59) and select down $2.65 ($257.41) with a movement of 109 loads (48.59 loads of choice, 31.86 loads of select, 8.77 loads of trim and 20.26 loads of ground beef). This past week choice cuts averaged $283.03 (down $7.80 from last week) and select cuts averaged $260.72 (down $8.28 from a week ago) and the market's total movement of cuts, grinds, and trim total 518 loads.
Milk production continues to remain strong with output continuing to exceed the level of last year despite having some bouts of very hot weather and areas experiencing continued drought. Spot milk price discounts continue to remain from $4 to $6 under class. Feed prices have become a bit less expensive recently after there were some rain events that moved across some of the dry areas of the Upper Midwest and Plains. The crop is a long way from harvest and remains at risk through pollination and the need for continued moisture. USDA will release its World Agricultural Supply and Demand report Monday, which may have a significant impact on grain futures. The report will also provide estimates for milk production for this year and next year as well as estimates for milk prices and product prices for this year and next year as well. USDA is expected to raise the level of expected milk production due to increasing cow numbers and production per cow.
Block cheese price has moved to the highest level it has been since May 14. Price has increased 26.75 cents since the low was set one month ago. Unfortunately, Class III milk futures have not been able to reflect the full impact of this gain due to the weakness of dry whey. During the same period, dry whey price has declined 11.25 cents, which has kept a lid on futures prices. For the week, blocks jumped 17 cents with barrels gaining 8 cents. Dry whey declined 4.25 cents.
For the week, butter declined 6.50 cents while Grade A nonfat dry milk slipped 0.75 cent. This put pressure on Class IV futures with contracts closing significantly lower. This week, there has been information coming from butter manufacturers that the cream market is beginning to tighten. This is later than usual but running somewhat seasonally. It is possible that a tighter supply and higher prices might result in lower production of butter as some plants may decide to sell some cream to take advantage of higher prices if and when they develop. For now, there is sufficient supply to satisfy manufacturing needs.
We are forecasting early gatherings, early placements and higher forage costs. Even our feed yards will be dry which isn’t good news for immature cattle adapting to new diets and surroundings. Plan now for the transition and help avoid this costly situation as much as possible. Give us a call, we can help you with your protocols.