Texas Agricultural Market Summary, 4/22/14

Posted 10 years 220 days ago by

Feeder cattle steady to $4 lower; futures higher.
Fed cattle cash trade inactive; futures mixed; beef prices higher.
Cotton cash prices unchanged; futures lower.
Grains and soybeans lower to sharply lower.
Crude oil higher; natural gas lower.
Stock markets modestly higher.

Texas auctions reported feeder cattle prices steady to $4 lower per cwt, with only a few locations reporting. Many were closed on Friday or Saturday for Good Friday. Feeder cattle futures were higher. Not much has changed with regard to feeder cattle market fundamentals, as strong demand and tight continue to support prices. However, the recent weakness in fed cattle has carried over to feeders to some extent and prices will continue to fluctuate depending on local conditions, types and quality of cattle on offer and buyer needs at a particular sale. The fed cattle cash trade was inactive Monday after declining a little more than $1 per cwt last week. Wholesale boxed beef values were higher. Estimated cattle slaughter for Monday totaled only 103,000 head, down 10% from last week and 16% below a year ago. Fed cattle futures were mixed, from 75 cents lower to 17 cents higher.

Cotton cash prices were unchanged, but futures were lower on reports of lower Chinese cotton imports so far this year and rumors that some Chinese textile mill may have closed. In Texas, planting delays were reported – too wet in some areas and too dry in others. Overall, 12% of the crop is now planted, equal to last year’s pace, but behind the average 15%. More rain in the southeastern U.S. also extended planting delays there.

Wheat prices were sharply lower yesterday as traders again shifted their focus from the turmoil in Ukraine to bearish fundamentals – ample world wheat supplies and lackluster demand. The condition of the U.S. wheat crop remains a concern, with reports of freeze damage last week adding to the stress from the very dry weather in many parts of the Winter Wheat Belt. However, the weekly USDA Crop Progress report issued yesterday afternoon after markets closed, showed little change in overall condition ratings. In fact, in Texas, the percentage of the crop rated poor to very poor actually improved a little. Nationally, wheat ratings did decline slightly; the percentage of the crop rated poor to very poor increased by one point. However, many observers had expected a sharper drop given the recent negative weather news.

Corn and grain sorghum prices were lower, mostly due to the sharply lower wheat and forecasts for decent planting weather. USDA reported that 6% of the nation’s corn crop is in the ground, ahead of last year’s 4%, but much below the 14% average. We’re still a week or two away from the normal surge in corn plantings and farmers in the major corn states can catch up in a hurry if/when weather conditions allow it. In Texas, corn planting was 60% complete, equal to the average for this date, and grain sorghum planting was 59% complete, 3 points behind last year, but 2 points better than the average.

Stock markets were modestly higher yesterday, with the Nasdaq Composite posting the largest percentage increase of the major indexes. There were no U.S. economic reports so traders focused on a report from Japan that showed its trade deficit grew more than expected due to much higher imports and only a small increase in exports. Halliburton and Advanced Micro Devices (AMD) posted better than expected earnings and revenue. Netflix released its first quarter results after markets closed, showing higher than expected earnings and an “upbeat” outlook for this quarter. Gains for Facebook and Twitter pushed the Nasdaq higher.

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.