Texas Agriculture Market Summary 4/25/14

Posted 10 years 217 days ago by

Feeder cattle steady to $5 higher; futures higher.
Fed cattle cash trade inactive; futures higher; beef prices higher.
Cotton cash prices lower; futures mostly higher.
Wheat and rice higher; corn and grain sorghum lower; soybeans higher.
Crude oil higher; natural gas lower.
Stock markets mostly higher.

Texas auctions reported feeder cattle prices steady to $5 higher in a limited test (for whatever reason, several of the regular reporters did not have a current report posted to their web site). Feeder cattle futures were higher as bullish fundamentals continue to support the market. The fed cattle cash trade was quiet across all major U.S. cattle feeding regions with sellers and buyers still several dollars apart and neither side willing to budge, yet. Wholesale boxed beef values were higher. Estimated cattle slaughter week-to-date is still running behind both last week and a year ago. Fed cattle futures were higher.

Beef export sales of 18,000 metric tons (MT) were down 18 percent from the previous week, but up seven percent from the prior four-week average. The leading buyers were Mexico, South Korea and Japan. Shipments totaled 11,900 MT, down six percent from a week earlier and three percent lower than the average. Japan, Hong Kong and Mexico were the top destinations.

Cotton cash prices were lower, but futures were mostly higher, with only the May contract posting a modest decline. Export data were supportive. Weekly sales were the largest since late February and even though shipments were lower, they were still well above the average needed to meet USDA projections for the marketing year. In addition, there does not seem to be any relief in sight for the very dry, and worsening, conditions on the Texas High Plains. Cotton export sales for the week totaled 124,100 bales, up 46 percent from the previous week and nearly three times higher than the prior four-week average. The primary buyers were China, Vietnam and the Philippines. An additional 16,400 bales were sold from the 2014/15 crop. Export shipments totaled 219,900 bales, down 22 percent from the previous week and down 20 percent from the average. The top destinations were Turkey, Vietnam and China.

Wheat prices were higher mostly due to ongoing concerns about dry conditions and freeze damage on the U.S. Plains, as well as the ongoing tensions in Ukraine. Canada reported that its wheat acreage will likely be lower this year, but numbers came in on the high end of pre-report expectations. Export data were generally bearish. Wheat export sales of 339,100 MT were down 20 percent from a week earlier, but up 13 percent from the prior four-week average and well within the range of pre-report expectations. The leading buyers were Japan, Taiwan and South Korea. Sales for the 2014/15 crop year totaled 271,700 MT. Shipments totaling 519,400 MT were down four percent from the previous week and down 3 percent from the average. Japan, Guatemala and Thailand were the top destinations.

Corn and grain sorghum prices were lower. Speculative profit-taking on the underlying futures contract was one factor. Wire service reports noted that “Parts of the Corn Belt are making some planting progress, but other areas are seeing another round of rain and cooler temperatures.” However, it is still very early in the season and there is plenty of time to catch up. Export data were neutral to supportive. Corn export sales for the week totaled 618,900 MT, up 15 percent from the previous week and on the high end of pre-report expectations, but down 30 percent from the prior four-week average. The top buyers were South Korea, Japan and Columbia. An additional 382,900 MT were sold for the 2014/15 marketing year. Shipments of 1,621,100 MT were up 52 percent from a week earlier and 33 percent higher than the average. The primary destinations were Japan, Columbia and Egypt.

Stock markets closed mostly higher yesterday, with the Dow ending the day unchanged. Both Apple and Facebook reported better than expected first quarter results, which helped push the tech-heavy Nasdaq Composite higher. Caterpillar also beat expectations, Verizon posted mixed results and 3M came in below expectations. Economic news was mixed. The Commerce Department reported that orders for durable goods increased much more than expected during March. Orders excluding transportation also came in much higher than expectations. The Labor Department reported that new unemployment claims rose to 329,000 last week, much higher than the 310,000 expected. After markets closed, Microsoft posted better than expected quarterly results. Amazon’s earnings matched expectations and revenue was higher. Pandora reported a smaller than expected loss on better than expected revenue.

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.