Texas Agriculture Market Summary 4/16/14

Posted 10 years 226 days ago by

Feeder cattle mostly steady; futures lower.
Fed cattle cash trade inactive; futures lower; beef prices higher.
Cotton lower.
Grains and soybeans higher to sharply higher, except rice futures lower.
Crude oil lower; natural gas higher.
Stock markets higher.

Texas auctions reported feeder cattle prices mostly steady, though one South Texas sale was $4-$8 higher on light-weight calves and steady to $4 higher on yearlings. Tight feeder supplies and strong demand continue to support the market. Feeder cattle futures were lower in response to higher corn futures. The fed cattle cash trade was inactive yesterday across all major U.S. cattle-feeding regions, with asking prices holding at $150 per cwt, up $3 from last week’s average. Wholesale boxed beef values were higher and weekly estimated cattle slaughter through Tuesday was even with a week ago, but lower than last year. Fed cattle futures were lower.

Cotton cash prices and futures were lower as buyers showed little interest in making additional purchases at Monday’s higher prices. The USDA Economic Research Service said that cotton acreage in the Southwest Region, which includes Texas, is expected be 11% higher than a year ago and 4% more than the previous five year average. The ongoing drought is expected to push more acreage into cotton (and maybe grain sorghum) as it tolerates dry weather better than some other crops. However, without timely rains, “yields could be low and abandonment heavy.” The region is expected to account for 61% of total U.S. upland cotton plantings, the highest share in 75 years, according to the report. Meanwhile, rain is delaying corn planting in the Southeast U.S. and Mississippi Delta, which could cause some corn acreage to switch to cotton or soybeans.

Wheat prices were sharply higher yesterday after freezing temperatures on the U.S. Plains likely caused additional damage to a crop already hampered by drought and winter kill. Reports noted that low temperatures dropped to 19 degrees Monday morning in Central Kansas and Matt Williams, TDA field rep in Lubbock, said that temperatures there got down to 28 degrees. On top of that, the USDA Crop Progress report issues after markets closed on Monday showed a continued decline in wheat condition nationally and in Texas. Traders were also keeping an eye on the increasing tensions in Ukraine, where the government pushed back against pro-Russia protestors in eastern sections of the country.

Corn and grain sorghum prices followed wheat higher. Traders are also concerned about planting delays in the southeastern U.S., but the region does not account for much of the total U.S. corn acreage.

Peaches: Wire service reports said that the drought in California and late freezes in South Carolina could put a dent in U.S. peach supplies this summer. Those two states are the top peach producers in the nation, with CA alone accounting for more than 70% of the total.

Stock markets closed higher following strong corporate earnings reports and mixed economic data. Citigroup, Johnson & Johnson and Coca-Cola reported better than expected first quarter earnings. Reports from Intel and Yahoo were due after markets closed. On the economic front, the Labor Department reported that both overall consumer prices and core inflation (excluding food and fuel) rose by 0.2% during March, topping expectations for 0.1% increases. The National Association of Home Builders sentiment index rose, but not as much as expected. The New York Federal Reserve declined, compared to expectations for a slight increase.

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.