Texas Daily Ag Market Summary 6/18/14

Posted 10 years 163 days ago by

Feeder cattle $3-$12 higher; futures lower.
Fed cattle cash trade inactive; futures lower; beef prices higher.
Cotton lower.
Wheat higher; corn, grain sorghum, soybeans lower.
Crude oil lower; natural gas higher.
Stock markets modestly higher.

Feeder cattle prices reported by Texas auctions were $3 to $12 higher per cwt with one location $20-$30 higher on 7-8 weight steers as record-high feeder cattle futures carry over into the cash markets. (Or maybe the record-high cash markets are carrying over into futures.) Both sides of the market are being supported by the very tight feeder cattle supplies and prospects that they will get even tighter as ranchers hold back heifers to rebuild their cow herds. The fed cattle cash trade remained inactive yesterday in all major U.S. cattle feeding areas with asking prices still at $150 per cwt. Wholesale boxed beef values were solidly higher. Estimated cattle slaughter through Tuesday totaled 230,000 head, equal to a week ago, but down 15K from the same period last year. Fed cattle futures were lower.

Cotton cash prices were sharply lower as traders rolled pricing from a July (old-crop) base month to the October (new-crop) contract and maintained a smaller, but still negative basis (spread between futures and cash). The result was a 3 cent per pound drop in cash prices. The nearby July futures contract was higher, but that was largely irrelevant to cash markets with the roll to October. New crop futures contracts were lower as prospects for this year’s crop continue to improve. It’s still dry in most of the major cotton producing areas of the state and timely rains will be needed to keep the crop growing. However, at this point, conditions remain favorable. Across the U.S. Cotton Belt, USDA rated 51% for the crop in good to excellent condition, much better than at this time last year and not too far off the recent high of 62% at this time in 2012.

Wheat prices were higher yesterday on reports that rains was delaying harvest in some areas and that yields were coming in lower than expected on the U.S. Southern Plains. However, market fundamentals remain generally weak as large world supplies and slack demand continue to pressure prices. Reports noted that 72% of the U.S. spring wheat crop is rated in good to excellent condition.

Corn and grain sorghum prices were lower as conditions remain favorable for large U.S. crops this year. Overall crop condition ratings improved over last week and higher yields are expected to make up for any loss in acreage.

Stock markets ignored negative economic news and concerns about Iraq to close modestly higher. The situation in Iraq seems to have faded into the “old news” category, at least for now. The Commerce Department reported that new housing starts fell by 6.5% during May and building permits fell by 6.4%, both well below expectations. The Labor Department reported that consumer prices rose by 0.4% during May, the largest monthly increase since February 2013 and double the expected rise. Excluding food and fuel, prices were up 0.2%, also more than expected and the largest increase since August 2011.

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.