Livestock producers recently saw futures markets impacted by a bearish Cattle on Feed report, then a Hogs and Pigs report that wasn’t friendly. This week brought USDA Acreage, and Grain Stocks reports in addition to the weekly Crop Progress and Condition reports. The crop reports caused grain futures to trade higher, putting pressure on the livestock complex, especially Feeder Cattle contracts.
The main driver effecting the markets is the corn acres planted. At 92.0 million acres, it was less than the 95.2 million acres industry analysts expected. Soybean acreage also came in less than trade expectations at 83.82 million acres versus the average estimate of 84.76. It’s understandable the markets would react, but from a livestock standpoint, corn acres are still 3 percent higher than 2019 with soybean acres up 10 percent. Grain stocks show corn supplies are slightly higher than this time in 2019 at 5.22 billion bushels. Of the total, 3.03 billion bushels are stored on farms, and that’s a lot of old crop corn that still needs to move into the market. Soybean stocks are 22 percent below 2019 levels. Even given the lower soybean stocks, there won’t be a shortage of livestock feed unless weather decreases yields significantly. (Admittedly the country is seeing just two types of weather heading into the new month –hot and dry or hot and wet.) Feeder Cattle futures rebounded and closed higher on Wednesday. Feeder cattle cash trade at auction markets was steady to higher after the report.
Wisconsin farmers planted 100,000 more acres of corn than indicated in the March Planting Intentions report. At 4.0 million acres, the total is 200,000 acres more than 2019. Farmers intend to harvest 2.9 million acres for grain this growing season. Soybean acreage is up 100,000 from March planting intentions as well. Wisconsin’s 2.05 million acres of soybeans compares to 1.75 acres planted in 2019. Weather in Wisconsin didn’t help crop conditions last week. Corn is rated 78 percent good to excellent, down 2 percent compared to the previous week. Soybeans were rated 79 percent good to excellent, slipping 3 percentage points. Hay conditions dropped 1 percent to 71 percent good to excellent. Wisconsin pastures are rated 79 percent good to excellent.
Swine influenza in China made news this week, with headlines saying it could lead to a pandemic. This is not a new influenza, but a version of H1N1 that has been in China’s hog herds since 2016, and one that humans can and do produce antibodies against. Hog producers here continue to be vigilant in their biosecurity measures to lessen the risk of foreign animal diseases impacting the US swine herd. This situation will continue to be monitored, but doesn’t pose the risk some headlines suggest. China was the lead buyer of US pork this week, purchasing 22,000 metric tons. Sales to foreign buyers
totaled 39,200 metric tons. China has grown their hog numbers faster than expected after huge losses from African Swine Fever and that will cut down on their need for imported pork in the long term. Their short term need for pork remains high.
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