Cattle and calves on feed for slaughter market in the United States for feedlots with capacity of 1,000 or more head totaled 10.8 million head on Oct. 1.
The inventory was 3 percent above Oct. 1, 2009. The inventory included 6.60 million steers and steer calves, up 3 percent from the previous year. This group accounted for 61 percent of the total inventory. Heifers and heifer calves accounted for 4.12 million head, also up 3 percent from 2009.
Placements in feedlots during September totaled 2.46 million, 3 percent above 2009. Net placements were 2.41 million head. During September, placements of cattle and calves weighing less than 600 pounds were 510,000, 600-699 pounds were 455,000, 700-799 pounds were 602,000, and 800 pounds and greater were 895,000.
Marketing of fed cattle during September totaled 1.8 million, 2 percent above 2009. Other disappearance totaled 54,000 during September, 15 percent above 2009.
Hoops’ analysis: The report is slightly bearish for the market with on feed and placements slightly above the average trade estimates and larger than a year ago. The trade had anticipated a slightly bearish report, minimizing the impact of the bearishness. The market reaction should be negative, but not long lasting.
Cold storage report: Frozen food stocks in refrigerated warehouses on Sept. 30, were greater than year earlier levels for eggs, chicken and cheese.
Total red meat supplies in freezers were up 5 percent from the previous month, but down 14 percent from last year. Frozen pork supplies were up 10 percent from the previous month but down 20 percent from last year.
Stocks of pork bellies were down 34 percent from last month and down 88 percent from last year.
Total frozen poultry supplies on Sept. 30 were down 2 percent from the previous month and down 5 percent from a year ago. Total stocks of chicken were up 1 percent from the previous month and up 12 per-cent from last year.
Total pounds of turkey in freezers were down 6 percent from last month and down 23 percent from Sept. 30, 2009.
Corn closed the week $.03 lower. For the first time in two weeks, private exporters announced a private sale of corn. 120,000 metric tons were sold to South Korea.
The weekly export sales report showed net sales of 212,500 MT were down 77 percent from the previous week and 72 percent from the prior four-week average. This was the lowest weekly export sales total in six years.
This year’s export profile is now at 755.4 million bushels versus the USDA forecast of 2.0 billion bushels. Large speculative traders added to the already net record long positions last week.
Strategy and outlook: Producers have sold/hedged a portion of the 2010 crop and re-owned cash sales with call options. Making 2011 sales above $4.50 is a great place next year’s marketing plan but don’t become too aggressive until more is known about the 2011 marketing year.
Soybeans closed the week $.14 1/2 higher from last week. Last week, private exporters reported sales of 440,000 MT of U.S. soybeans to unknown destinations and 420,000 MT to China. Brazil’s 2010/11 soy crop, which is now being planted, should total a record 69.6 million tonnes, up from a revised 69.0 million tonnes.
The weekly export sales report showed net sales of 2,01 MT were up 85 percent from the previous week and 66 percent from the prior four-week average. This year’s export pace stands at 930.7 mb versus the USDA forecast of 1.520 bb.
Strategy and outlook: Producers have sold/hedged a portion of the 2010 crop and re-owned cash sales with call options. Making 2011 sales above $10.30 is a great place next year’s marketing plan, but don’t become too aggressive until more is known about the 2011 marketing year.
Brian Hoops is president and senior market analyst of Midwest Market Solutions Inc. Midwest Market Solutions is a full-service commodity brokerage and marketing advisory service, clearing through R.J. O’Brien.
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