TDA Daily Agriculture Market Summary 4/2/14

Posted 10 years 240 days ago by

Feeder cattle mostly steady to $5 higher, few $10 higher, few $4 lower; futures lower.
Fed cattle cash trade inactive; futures lower; beef prices lower.
Cotton lower.
Grains and soybeans mostly higher, except wheat lower.
Crude oil and natural gas lower.
Stock markets higher.

Texas auctions reported feeder cattle prices were mostly steady to $5 higher per cwt, with one location as much as $10 higher and one as much as $4 lower on calves. In general, prices have been a little stronger for stocker-type cattle that are ready to turn out on summer pasture. Feeder cattle futures were lower in response to higher corn futures. The fed cattle cash trade remained quiet yesterday across all major U.S. cattle feeding areas, with asking prices still up $3 from last week’s average. No word yet on packer bids. Wholesale boxed beef values declined again yesterday, with Select-grade offerings down the most. There was some talk on Friday that packers let some beef go at lower prices in order to clear out some freezer space, but they’ve slipped even lower since then. Cattle slaughter this week is running a little behind last week, but ahead of last year’s pace. Fed cattle futures were lower, mostly because of the lower beef prices.

Wire services reported yesterday that Ecuador will resume beef imports from the U.S.. “According to the U.S. Meat Export Federation, muscle cuts and offal from cattle of all ages are eligible, unless the cattle have been imported from Canada, then the animal must be in the U.S. sixty days before slaughter. Ecuador banned U.S. beef imports more than a decade ago due to BSE.”

Cotton cash prices and futures were lower yesterday as markets continue to adjust to Monday’s planting intentions report. Cotton planting is well underway in Texas, with reports that half or more the Lower Rio Grande Valley acreage is planted. Meanwhile, some farmers in the Coastal Bend are waiting for a rain. Overall, 6% of the state’s acreage has been planted, equal to last year’s progress, but a point behind the 5-year average. There is also a little rain in the forecast for the Texas Plains.

Wheat prices were lower, mostly due to speculative and fund selling on the underlying futures contract. Traders noted that recent price increases may have gone too far given the large world supplies and lack of a bump in exports from the Ukraine crisis. Dry weather on the Plains and declining crop conditions remained supportive. Rain is in the forecast for some areas, but much will be needed to bring the crop around.

Corn and grain sorghum prices were higher as markets continue to adjust to USDA’s “Prospective Plantings” report that showed higher than expected corn acreage. Planting is just now getting underway in southern states and is still some time away for the Corn Belt. The higher prices could still draw more acres to corn and they could put a dent in demand, especially of ethanol usage or exports slip.

Yesterday’s Crop-Weather report from Texas A&M AgriLife Extension included a good discussion by AgriLife agronomist on how worsening drought conditions could impact planting decisions. Click here for the full report.

The most recent DTN fertilizer survey showed higher prices for all eight of the benchmark fertilizers included in the survey. The report noted that this marked the sixth consecutive week that all fertilizers have been higher.

Stock markets closed higher, with the S&P 500 hitting a new all-time record 1,886 points. A U.S. manufacturing index came in slightly lower than expected, but the shortfall was blamed on lingering “winter doldrums.” China’s official factory index rose slightly during March, but still indicated the sector was contracting. A European Union factory index rise during March with readings for Germany and France, the EU’s largest economies, topping expectations. Monthly U.S. auto sales figures were also released yesterday. Ford’s sales grew by 3% in March, Chrysler’s were up 13% and GM’s numbers were delayed by a “computer issue.”

Disclaimer: The information compiled in the Daily Market Summary is obtained from a variety of sources, including those available on the Internet, that are believed to be reliable and accurate, but are in no way guaranteed. This information is intended to provide only a summary of market trends and a daily snapshot of agricultural markets and economic indicators. It should not be relied upon as a sole source of market information. Commentary is the author’s alone and does not in any way convey official TDA policies.