In last week’s (3/30) quarterly Hogs and Pigs Report, the USDA said total herd inventories were down 2.3% vs. a year ago, while hogs kept for breeding declined 1.9%. Dec-Feb farrowing intentions were down 1.0%; Mar-May down 1.5%. The numbers were below pre-report expectations and bullish for prices.
Read MoreIn Friday’s Cattle on Feed report, the USDA said feedlot inventories, at 12.16M head on March 1, were up 1.4% from a year ago. New placements onto feedlots in February jumped 9.3% from a year ago, resuming the trend toward large, year-over-year, liquidation-driven placement gains in 4 of the past 5 months.
Read MoreAfter hitting 14-year highs of $123.70 per barrel on 3/8, WTI crude oil futures have retreated to $104.70 (3/18). AAA says the national average for gasoline dropped from $4.33 to $4.25 per gallon and should drift lower if oil stays near $100. Meanwhile, the political blame game rages on social media, so here are the facts in order of importance:
Read MoreThere are 4 (major) traded edible oils. Looking at just exports for the 2021/22 crop year, palm oil is king with a 56% share, sunflower seed oil is 2nd at 15%, soybean oil is 3rd at 14%, and rapeseed (canola) comprises 6%. Ukraine accounts for 80% of the world’s sun-oil trade, which works out to roughly 12% of all globally traded veg-oils. That 12% is lost for the foreseeable future.
Read MoreIt’s been a week in commodities like few in history. And even though we were sounding the alarm on crude oil, veg-oils, and wheat since January – actually seeing it unfold was a little frightening. With Russia close to sealing off Ukraine’s southern coast and ports – and with OPEC well behind their targeted oil production targets – prices for the 3 (above mentioned) commodities exploded last week.
Read MoreIn Friday’s Cattle on Feed report, the USDA said feedlot inventories, at 12.2M head on Feb 1, were up 0.8% from a year ago. New placements onto feedlots in January were down 1.2% from a year ago, following 3 straight months of large, year-over-year, liquidation-driven placement gains.
Read MoreRussia’s invasion and annexation of the Crimean Peninsula in 2014 eliminated Ukraine’s small navy and set up Russia (if it chooses to do so) for unimpeded naval blockades. In 2022, 95% of Ukraine’s grain exports were transported via Black Sea ports.
Read MoreLooking at the economic storm clouds: Covid, supply chain issues and tight labor markets are carrying over into 2022. But this year we can add 2 more growth killers: rising interest rates and high fuel prices. Jan’s CPI came in at a 40-year high of +7.5%.
Read MoreSoy-oil futures moved above $.65/lb last week and now look poised to challenge the record high of $.72 set in June 2021. Soy-oil averaged $.5815/lb last year, following a 6-year stretch (2015-2020) of averaging just $.3117.
Read MoreGeopolitics is helping light a fire under grain prices. Russia is the world’s top wheat exporter, and Ukraine is #4 globally in wheat exports and #3 in corn. Russian wheat exports are already down roughly 30% since July 2021, due to restrictions aimed at curbing domestic inflation.
Read MoreIn Friday’s Cattle on Feed report, the USDA said feedlot inventories, at 12.04M head on Jan 1st, were up 0.6% from a year ago. New placements onto feedlots in December were 6.5% above a year ago, confirming large numbers of cattle moving off of dried-up pasture.
Read MoreDairy herd numbers plummeted 122,000 head or 1.3% in just 6 months – and tighter milk supplies are impacting prices. Butter that was still below $2.00/lb in early Dec has jumped to $2.7250 (1/14). Butter output in Nov was 9.6% below a year ago.
Read MoreGreen carbon initiatives have turned soy-oil into an energy commodity, and as such, its correlation to crude oil is undeniable. In 2021, soy-oil futures started the year at .4293/lb and hit a high of $.7208 on 6/8/21. Crude oil futures started 2021 at $47.62 per barrel before running up to $75.23 on 7/1/21.
Read MoreCovid, labor markets, supply chain issues and rising costs will continue to be ongoing issues in 2022. Current models show Covid cases peaking in late Jan, but then taking most of Feb/Mar to recede. That’s going to take a bite out of Q1 GDP, with growth now forecast in the 2-3% range – down from pre-Omicron forecasts of 5-6%.
Read MoreSanta’s sleigh was a little short on beef and pork for 2022. In Thursday’s Cattle on Feed report, the USDA said Nov cattle marketings were up 5.3% from a year ago, while new placements were up 3.6%, resulting in a Dec 1 feedlot inventory that was down 0.4% from a year ago.
Read More‘Twas the night before Christmas, and all through the White House, not a creature was stirring …….. OMG check his pulse. The Pres was just sleepy, there’s no need to worry, he’ll wake up to scold us and spend all our money. When up on the roof, there arose such a clatter, Joe sprang from his bed, to see what was the matter.
Read MoreLast week, the EPA proposed lowering ethanol blending mandates retroactively for 2020 & 2021, to better match decreased fuel usage, but to increase quotas for 2022. EPA’s proposal also increases biofuel blending to 2.76B gallons, up 14% from 2019/2020 levels.
Read MoreConcerns that the Omicron variant, and associated new travel restrictions, will put a dent in global oil usage sent West Texas Intermediate crude oil futures plummeting from over $80 per barrel in November to $66.26 on Friday (12/3). Additionally, OPEC announced that it will expand oil production by 400,000 barrels per day (monthly) through January.
Read MoreWill there be any relief from high protein prices in 2022? Not likely in beef and pork, with the USDA forecasting output to decline by 3.5% and 0.3%, respectively, in 2022. But chicken is showing signs of recovery. Despite high feed prices, producers are putting up record profits and the industry looks to be gambling on expansion.
Read MoreIn Friday’s Cattle on Feed report, the USDA said feedlot inventories, at 11.95M head on Nov 1st, were down 0.2% from a year ago. New feedlot placements in October were 2.4% above 2020 levels. We are in the 3rd year of a liquidation and contraction cycle for cattle herds that is being compounded by poor pasture conditions.
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