Texas Daily Ag Market Summary 5/20/14

Posted 10 years 192 days ago by

Feeder cattle steady to $7 higher; futures higher.
Fed cattle cash trade inactive; futures higher; beef prices higher.
Cotton lower.
Wheat, soybeans higher; corn, grain sorghum, rice lower.
Crude oil and natural gas higher.
Stock markets modestly higher.

Feeder cattle prices reported by Texas auctions were steady to as much as $7 higher per cwt compared to the previous sale. The Oklahoma City National Stockyards on Monday were mostly steady to $4 higher, with 850+ pound feeder steers $3-$6 higher. Reduced cattle supplies and strong demand for feeders continues to support the market. There were several comments that feedlots are opting to buy at these record or near-record high prices now, rather than waiting to buy later this summer at what might be even higher prices. The fed cattle cash trade was inactive after slipping more than $1 lower last week, though prices remain at near-record high levels. The TCFA daily volume and price summary shows 64,900 head in formula trades this week, down from 69,900 last week. Wholesale boxed beef values were higher yesterday. Estimated cattle slaughter for Monday totaled 118,000 head, up 2,000 from last week, but down 7,000 from a year ago. Fed cattle futures were higher.

USDA NASS released its weekly Crop Progress report after markets closed yesterday. Some highlights are included below. Click here for the Texas summary or here for the national report.

Cotton cash prices and futures continue to slide lower mostly due to selling by hedge funds on the underlying futures market contract. Otherwise, the cotton situation has not changed much – huge stockpiles in China, tighter supplies in the U.S. and globally outside China, very dry conditions on the Texas High Plains, beneficial rains in East Texas and improved planting weather in the Southeast U.S. In Texas, cotton planting advanced to 36% complete, well ahead of last year’s 28%, but slightly behind the 5-year average. The report noted that some farmers are waiting for rain before planting dryland cotton. Nationally, cotton planting is 46% complete, also ahead of last year, but only 2 points shy of the average.

Wheat prices were higher yesterday after weekly export inspections came in on the high end of pre-report expectations. The ongoing drought on the U.S. Plains also continued to support prices. In Texas, the winter wheat acreage is rated in mostly poor to very poor condition, with an overall condition index of 33 points, unchanged from both last week and a year ago. 89% of the acreage has headed and 6% has been harvested, ahead of both last year and the 5-year average. Nationally, wheat crop condition ratings declined a little, with 44% of the acreage now rated poor to very poor compared to 42% a week ago.

Corn and grain sorghum prices were lower after a “weak export inspections report” that was within trade expectations. The potential for a large crop this year also pressured markets as the same rains that delayed plantings will now benefit early crop development. In Texas, the corn crop is 92% planted and grain sorghum planting is 82% complete, both well ahead of last year and equal to the average (corn) or ahead of it (grain sorghum). Both corn and grain sorghum were rated in mostly fair to good condition. Nationally, corn planting advanced to 73% complete, well ahead of last year’s 65% and only a few points behind the 76% average. As expected, Corn Belt farmers were able to make rapid progress once they had favorable weather.

Stock markets were modestly higher yesterday with little fresh news, other than a report that Chinese housing prices rose last month, but at a lower rate than in March. That raised concerns among some traders about China’s “fragile debt markets.”

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.