THE LAND — APRIL 2/APRIL 9, 2021
www.thelandonline.com — “Where Farm and Family Meet”
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MARKETING
Grain Outlook Livestock Angles Covid decline Prospective Planting and Grain Stocks report rockets corn should help livestock prices
up cattle are now disappearThe five top producing corn As we approach the end of The following marketing ing and feedlots are closer to states of Iowa, Illinois, March and move into the analysis is for the week endnormal numbers on feed Indiana, Minnesota and month of April, the livestock ing April 2. before the Covid crisis. Cattle Nebraska are all expected to markets have had a good CORN — The market was on feed numbers have been have unchanged or lower month as prices have moved treading water waiting for declining over the past sevacreage this year. Corn acre- higher to levels not seen in the March 31 Prospective eral months which has helped age in Minnesota this year is quite a while. With the Covid Planting and Grain Stocks turn the corner and improved expected to stay at last year’s infections declining and the reports. And boy, were they prices for finished cattle. 8 million acres, Illinois is lockdown loosening, restauworth the wait! Nothing had JOE TEALE The replacement market PHYLLIS NYSTROM estimated to fall 400,000 to rants are reopening — which prepared us for the surprise Broker 10.9 million acres, Iowa down has increased the demand for CHS Hedging Inc. has also improved since those the U.S. Department of St. Paul 400,000 at 13.2 million, North meat products. The outlook Great Plains Commodity March 2020 lows to near the Agriculture had in store. Afton, Minn. Dakota up 1.35 million to 3.3 appears to be improving. The levels they collapsed from. As The corn acreage estimate million acres, South Dakota caveat to this is because of we look ahead, the outlook came in below the lowest estimate at up 650,000 to 5.6 million, Nebraska the unemployment problem, demand appears to be positive but guarded; just 91.144 million acres. The average down 300,000 at 9.9 million, Indiana from this point forward will likely because a lot will depend on an improvestimate was 93.2 million and last down 200,000 at 5.2 million, and decline until the economy rebounds to ing economy which will have a direct year’s planted acreage was 90.82 mil- Wisconsin up 150,000 at 4.15 million better levels. All livestock markets at influence on demand for product. The lion acres. It was also nearly 1 million corn acres. this writing were either overbought or weeks ahead will be important as to acres less than the USDA’s estimate at Many expect final corn acres to be approaching that condition. This would which direction cattle prices will take their February Outlook Forum. higher than the March 31 forecast. advise caution at this juncture; but into the summer months. Grain stocks as of March 1 were Historically, this has proven difficult to does not mean higher levels can’t be The hog market has had an impres7.701 billion bushels vs. 7.767 billion do. In recent history, the average acre- attained. sive rally over the past several months. bushels expected. This is the lowest age increase from the March to June Cattle prices have continued to Hog numbers have been reduced March 1 stocks number in seven years. report is 800,000 acres. However, if the improve since their lows established in because of the severe cold weather Last year we had 7.952 billion bushels weather cooperates and prices stay March of 2020. This has been mainly back in February which aided the on hand on March 1. This confirms we elevated, we should see at least a mod- due to the fact that the market got strong market in the past two months. have not yet rationed this year’s corn est increase in acreage. Combined corn overdone on the downside from the Couple this with a good export marand ending stocks are closer to 1.2-1.3 and soybean acreage at 178.7 million scare of Covid virus. This caused the ket and prices moved to levels not billion bushels. The USDA’s last esti- acres are well below the record of 180.3 lockdown of people in their homes and seen since 2014. mate was 1.5 billion bushels. We won’t million in 2017. the closure of businesses which obviCurrently, the market is extremely see the USDA 2021-22 balance sheet Corn stocks were slightly lower than ously hurt demand for beef. As things overbought and could be subject to a until the May 12 World Agriculture anticipated at 7.701 billion bushels and have relaxed, demand for beef has once correction. However, this maybe short Supply and Demand Estimates report. again picked up. As a result, the backed- lived as the latest U.S. Department of Corn locked up the 25-cent limit See NYSTROM, pg. 20 Agriculture Hogs and Pigs report immediately after the report’s release. released March 25 was friendly due to The run-up erased the loss for the the reduced numbers. month and saw the monthly continuOne noticeable condition is as the ous corn chart keep its eight-month corn/change* soybeans/change* pork cutout has risen, the movement streak of higher closes alive. New con St. Cloud $5.27 +.08 $13.74 +.11 of products has slowly decreased. This tract highs were set in virtually all the Madison $5.22 +.04 $13.78 -.04 could be signaling a slowly diminishcontracts with May at $5.85, July at ing demand for pork because of higher Redwood Falls $5.34 +.03 $13.79 -.04 $5.66.25, and December at $4.93 per prices. The next few weeks should Fergus Falls $5.22 +.04 $13.64 +.06 bushel in the night session following give a signal as to which direction the Morris $5.23 +.06 $13.68 .00 the limit up move. We ended the holihog market will take into the summer Tracy $5.30 +.06 $13.90 +.01 day-shortened trading week on a mixed months. v note with old crop posting small losses Average: $5.26 $13.76 and new crop with decent gains. This emphasizes the more bullish number Year Ago Average: $2.85 $7.89 on the reports came from the acreage Grain prices are effective cash close on April 6. number.
Cash Grain Markets
*Cash grain price change represents a two-week period.
Information in the above columns is the writer’s opinion. It is no way guaranteed and should not be interpreted as buy/sell advice. Futures trading always involves a certain degree of risk.
