Texas Daily Ag Market Summary 5/7/14

Posted 10 years 205 days ago by

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

Feeder cattle prices reported by Texas auctions were mostly $1-$5 higher at some locations, fully steady at one and steady to $4 lower at another. Light-weight calves again showed the most weakness while heavier offerings posted the largest price gains. The deepening drought and fears that summer forage will not hold up have taken the shine off the light calf market while low feedlot placements last month and continued high fed cattle markets have boosted demand for feedlot-ready cattle. The fed cattle cash trade was inactive yesterday, with asking prices around $148 and early packer bids at $145, compared to last week’s $146 average. Private sources said 1,200 steers sold in Nebraska on a dressed basis at $238, up $1 from last week and the equivalent of about $152 cash. Wholesale boxed beef values were lower. Estimated cattle slaughter through Tuesday continued to run higher than a week ago, but lower than last year. Fed cattle futures were higher.

Cotton cash prices and futures were lower on speculation that USDA’s initial production and carryover stocks projections for the 2014/15 marketing year will come in higher than a year earlier. World supplies are also expected to grow. Lower stock markets were also a likely factor in the decline, though losses were limited by slow planting progress nationwide and the very dry conditions in Texas.

Wheat prices were higher again yesterday as crop conditions continued to decline. Forecasts call for the hot, dry weather to persist on the Southern Plains, while spring wheat growers further north are running behind on planting. Traders were also “keeping an eye on political developments in and around” Ukraine as tensions spread to Odessa, the country’s largest port and last remaining outlet to the Black Sea.

Corn and grain sorghum followed wheat higher, in spite of poor export news and expectations that Midwest farmers will make rapid planting progress this week. Wire service reports said that Spain and an unknown destination cancelled 220,000 metric tons of old-crop corn purchases.

The White House yesterday released an updated “National Climate Assessment” that paints a dire picture with, as wire services noted, “water growing scarcer in dry regions, torrential rains increasing in wet regions, heat waves becoming more common and more severe, wildfires growing worse, and forests dying under assault from heat-loving insects.” Researchers found that these events resulted from a 2 degree increase in temperatures over the past century and warned that “If greenhouse gases like carbon dioxide and methane continue to escalate at a rapid pace, the warming could conceivably exceed 10 degrees by the end of this century.” Supporters called the report a scientific blueprint for corrective actions at the local, state and national levels. Opponents called it a job-killer, assault on fossil fuel-based industries and pretext for increased government intrusion and regulation.

Stock markets fell yesterday with “smaller high-growth companies and Internet stocks” suffering the worst losses. Twitter fell 18% as shares held by company insiders since their IPO became eligible for sale. Merger and acquisition activity dominated news out of the health care sector, with Pfizer trying to buy AstraZeneca, Merck selling its consumer care division to Bayer and Valeant trying to buy Allergan. AIG (insurance) fell after reporting a 27% drop in first quarter profits. The Commerce Department reported that the U.S. trade deficit narrowed during March, as expected.

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.