Texas Daily Ag Market Summary 6/30/14

Posted 10 years 151 days ago by

Feeder cattle mostly $2-$10 higher; futures lower.
Fed cattle cash trade record high; futures lower; beef prices higher.
Cotton cash prices unchanged; futures higher.
Grains unchanged to higher; soybeans lower.
Crude oil and natural gas lower.
Stock markets modestly higher.

Feeder cattle prices reported by Texas auctions were mostly $2-$10 higher, with a few steady and some as much as $15 higher. As the USDA National Feeder Cattle Summary said, prices continue to push to new record highs “higher on unbelievable demand and incredibly active trading.” Quite a few auctions will be closed later this week and early next week because of Friday’s Independence Day holiday so that may have inspired some of the increase, but most was likely due to the very bullish fundamentals. In addition to the robust feeder market, the fed cattle cash trade jumped $4 per cwt Friday to a new record high of $154 per cwt, though only on a little over 1,000 head of confirmed sales. Fed cattle futures slipped lower on the June contract, set to expire today. Wholesale boxed beef values were higher. Estimated cattle harvest for the week totaled 615,000 head, 2K higher than the previous week, but down 39K from a year ago. For the year, cumulative cattle harvest is running 6.3% behind last year’s pace.

Cotton cash prices were unchanged on Friday, but futures were higher, mostly due to positioning ahead of today’s USDA NASS Acreage report. We will likely see a minor downward adjustment in acreage from the intentions estimate back in March, but anything more than a couple hundred thousand acres either way would be a surprise. Current supplies of uncommitted cotton remain very tight, but world stocks are also plentiful and ongoing rain showers continue to benefit this year’s crop. One thing to keep an eye on is the failure of a strong monsoon season to develop over major producing areas in India and Pakistan. It’s also dry in China’s cotton areas and Australia is expected to produce less cotton this year. All that could cut into world supplies and push prices a little higher.

Wheat prices were higher as harvest delays and quality concerns continue to hold traders’ attention. Yields have also come in lower than expected for many producers. On the other hand, wire services report that, “World wheat weather remains mostly good, with problems confined to eastern Russian spring wheat areas for now.”

Corn and grain sorghum prices were unchanged to higher ahead of this morning’s USDA Acreage report. More rain and cooler temperatures are forecast for the Corn Belt this week. Reports note that “The weather forecast remains good overall with any problems confined to relatively small areas mostly due to heavy rain.” Conditions still favor a large corn crop this year.

Stock markets closed modestly higher on Friday with little economic or corporate news to move prices much in either directions. A major consumer sentiment index was higher than a month ago and above expectations. Nike posted better than expected quarterly results after market closed Thursday. DuPont lowered its earnings expectations due to weaker than expected performance in its agriculture divisions during the second quarter.

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.